Chinese telco giants Huawei and ZTE have strongly refuted the allegation of the US’House Permanent Select Committee on Intelligence (the Committee) that they pose a security threat saying that the committee ignored their proven record and failed to prove evidence.
 
In its statement Huawei on Monday said that the United States is a country ruled by law, where all charges and allegations should be based on solid evidence and facts.

“The report conducted by the House Permanent Select Committee on Intelligence (the Committee), which took 11 months to complete, failed to provide clear information or evidence to substantiate the legitimacy of the Committee's concerns”, it said.

The House Intelligence Committee in US in its draft report has recommended that two Chinese telco giants Huawei and ZTE should be kept out of contracts and acquisitions in the US as they pose security threat.

The draft report of the panel which is the outcome of a yearlong congressional investigation suggested that these two firms are under the influence of the Chinese government and cannot be trusted.

Huawei said the over the past 11 months, it had cooperated with the Committee in an open and transparent manner, and engaged in good faith interaction
“However, despite our best effort, the Committee appears to have been committed to a predetermined outcome”, it said.

Huawei said that the ranking member of the Committee stated at the hearing that the investigation by the committee "is not political jousting or trade protectionism masquerading as national security".

“Unfortunately, the Committee's report not only ignored our proven track record of network security in the United States and globally, but also paid no attention to the large amount of facts that we have provided. It said that the report released by the Committee today employs many rumors and speculations to prove non-existent accusations.

ZTE in its response said that it presented the Committee with ample facts that demonstrate ZTE is China’s most transparent, independent, globally focused, publicly traded telecom company. ZTE is listed on the Hong Kong and Shenzhen Stock Exchanges. The company already is recognized as a Trusted Delivery Partner by 140 governments and 500 network carriers.
 
ZTE said that its equipment is safe for US telecom infrastructure. “In its Fourth Recommendation, the Committee encourages companies to offer “more consistent review by independent third-party evaluators of their cybersecurity processes.” 
 
“The Committee has credited ZTE with advocating a solution, based on a Trusted Delivery Model, in which the telecom vendor transfers hardware, software, firmware, and other structural equipment elements to an independent third-party threat assessment laboratory with US government agency oversight”.
 
“The Committee has raised technical questions regarding the effectiveness of Trusted Delivery Systems, but the Committee recommends continuing efforts to identify effective mitigation solutions”, ZTE said in a statement.
 
David Dai Shu, ZTE’s director of global public affairs, said “ZTE appreciates the Committee’s recognition that ZTE has offered US carriers a Trusted Delivery Model solution. ZTE will work with the Committee, US government agencies, and ZTE’s US customers to identify and deploy the most effective equipment cyber-security measures possible. ZTE is committed to assuring US carriers and US government agencies its equipment is safe.”
 
Dai Shu said, “It is noteworthy that, after a year-long investigation, the Committee rests its conclusions on a finding that ZTE may not be ‘free of state influence.’  This finding would apply to any company operating in China. The Committee has not challenged ZTE’s fitness to serve the US market based on any pattern of unethical or illegal behavior.”
 
According to the Committee, ZTE was included in this investigation simply because it is one of “the top two Chinese telecommunications equipment manufacturers.” Virtually all of the telecom infrastructure equipment now sold in the US and throughout the world contains components made, in whole or in part, in China. That includes the equipment manufactured and sold by every Western vendor in the United States, much of which is made by Chinese joint venture partners and suppliers.
 
Dai Shu said, “Particularly given the severity of the Committee’s recommendations, ZTE recommends that the Committee’s investigation be extended to include every company making equipment  in China, including the Western vendors. That is the only way to truly protect US equipment and US national security. National security experts agree that a Trusted Delivery Model will strengthen national security. In fact, major US carriers are increasingly requiring Trusted Delivery Model in their contracts.”