Communications Minister Malcolm Turnbull said there is no timetable for the review of the Huawei NBN ban.
Photo: Glenn Hunt
The Abbott government could relax the ban on equipment from Huawei being used on the national broadband network even if security concerns over the Chinese telecommunications company are not fully allayed.
In an exclusive interview, Communications Mininster Malcolm Turnbull detailed grounds for the review and explained why there may be scope to lift the NBN ban on Huawei.
He said the question was not just whether the company may be a security threat because of alleged links with the Chinese government, but if the equipment the company provided could be used for espionage.
“Even if you accept the premise that Huawei would be an accessory to espionage – I’m not saying they will be, I’m just saying that’s the premise – if you accept that, you then have to ask yourself, does the equipment that they would propose to sell have that capacity?” Mr Turnbull said, in the interview to be published in BRW on Thursday.
Huawei, one of the world’s largest telecommunications equipment makers, was gearing up to fight for lucrative contracts to roll out NBN technologies, after Mr Turnbull’s August announcement the ban would be reviewed.
Huawei, based in Shenzhen, was banned from NBN involvement under the former Labor government due to security concerns. Huawei strenuously denied claims it spied for the Chinese government or was a security threat.
Mr Turnbull said the issue that would be examined as part of the Coalition’s review of the ban in Australia, was one of a “technical” nature.
“Is the equipment that Huawei is proposing to sell to you, or the systems that they are proposing to sell, capable of intercepting and diverting traffic signals in a manner that is not detectible?
“Historically, people from a security point of view, have been much more concerned about equipment and systems at the centre of the network; that control the whole network, and less concerned about equipment at the edge of the network. That is why nobody seems to mind that there are . . . millions of mobile handsets made either by Huawei or ZTE, which is the other big Chinese telco equipment manufacturer, which actually is state-owned.”
Mr Turnbull is one of several Liberal ministers who, in opposition, met with Huawei senior executives. The company, which appointed former foreign minister Alexander Downer and former Victorian premier John Brumby to its local board, is building eight of the nine NBNs around the world, including the UK’s fibre network with BT.
Huawei’s deputy chairman Ken Hu said on Friday the company had not had any requests from any government to change its policies, procedures or equipment.
“We can confirm that we have never been asked to provide access to our technology, or provide any data or information on any citizen or organisation to any government, or their agencies,” he said at the launch of a white paper on cyber security, in Seoul.
Huawei Australia worked with all of the nation’s major telecommunications operators and the company said more than 50 per cent of Australians used a Huawei product for their telecommunications needs.
Huawei’s Australian partners included Vodafone-Hutchison Australia, Optus, Telstra, AAPT, Primus, TPG and iiNET.
Mr Turnbull said he had not met Huawei executives since becoming communications minister, but admitted in opposition he held “irregular” meetings with Ren Zhengfei and Guo Ping. Mr Zhengfei, a former People’s Liberation Army officer, retired from the army in 1982 but his ties with the Chinese military and communist party were still raised as a security concern.
Mr Turnbull said if Huawei’s equipment and systems were found to be questionable, the government “probably wouldn’t buy it”. There was “no timetable” for reviewing the ban. A decision would be made “collectively as a government”.
“That’s something that I will discuss with my colleagues, in particular George Brandis, the Attorney-General, and Julie Bishop, the Foreign Minister.
“The critical issue is, you’ve got to form a judgment about Huawei, but then you’ve also got to form a judgment about the equipment that they are selling. There’s both an overall assessment at a corporate level, and a technical assessment. I’m saying that we will review the matter in light of evidence [the government gets] in due course.”
As with the former Labor government, the Coalition was not willing to share security intelligence about the company. “The government has to form a judgment about that, and it may be we will form a judgment and never disclose the factual basis because it involves information of a national security nature,” Mr Turnbull said.
In June a UK parliamentary committee released a report saying Huawei’s involvement in the country’s telecommunications sector could raise potential national security issues. Huawei had also virtually been shut out of the United States market because of similar concerns.
A report by the US House Intelligence Committee said Huawei and the other big Chinese telecommunications equipment provider, ZTE, posed sufficient security risks and that government agencies should avoid buying their equipment.
Mr Turnbull had said he was “technology agnostic”, and open to using whatever was the most cost-effective technology for the NBN.
Huawei was China’s biggest telco and the company could offer broadband access products for all types of network architecture. These could be used in traditional copper networks, fibre networks and hybrid fibre/copper networks.
Huawei would not be drawn on any discussions the company’s senior management may have had with Mr Turnbull since he took over as Communications Minister.
However, Huawei’s corporate affairs director Jeremy Mitchell said: “As one of the world’s leading telecoms vendors, we look forward to working with the new government”.
Mr Turnbull said he was impressed by Huawei’s business credentials.
“Huawei is almost incredible; it’s grown so quickly,” he said.
Huawei reported global revenues of $US35.35 billion for 2012, nearly on par with Sweden’s Ericsson’s $US35.75 billion revenue. Huawei had customers in 140 countries and worked with 45 of the world’s top 50 operators.
“It’s involved in building most of the broadband networks around the world,” Mr Turnbull said.
“It’s a very credible business. The issue is whether it’s a security threat.”
Huawei spent $US5 billion globally on R&D annually. It reported Australian revenue of $368 million in 2012, a 61 per cent rise from the previous year.
Huawei Australia chairman John Lord told a public hearing of the parliamentary joint committee on intelligence and security last year that the company still had to gain the trust of Australians. Mr Lord also suggested a national cyber security centre be built to test technologies for projects such as the NBN.
In July, the former head of the US Central Intelligence Agency and National Security Agency, Michael Hayden
, told The Australian Financial Review that in his “professional judgment” Huawei was a threat because it supplied sensitive intelligence to Chinese officials.