Huawei Gets New Pressure From Congress as Trump Prepares to Meet Xi

(Bloomberg) -- U.S. pressure on Huawei Technologies Co. increased as senators voted to cite the Chinese telecommunications gear maker as a security risk ahead of this week’s meeting between President Donald Trump and Chinese President Xi Jinping.

The Senate Foreign Relations Committee, on a voice vote, passed a resolution Tuesday designating Huawei and fellow Chinese equipment maker ZTE Corp. as a threat to the national security of the U.S. and its allies. The measure, which moves on for further votes, called for more pressure for allies to shun the companies’ network equipment.

“Huawei and ZTE telecommunications products are not safe for the U.S. or any of our allies around the globe,” said resolution sponsor Cory Gardner, a Colorado Republican and member of the Foreign Relations panel. “It is my hope all of our allies in Europe and around the globe hear us loud and clear.”

Germany and other countries “against the strong advice of the United States” have indicated they may let Huawei build out advanced 5G wireless networks, according to the resolution. Germany has resisted U.S. attempts to persuade it to blackball Huawei and instead plans stringent testing and oversight for all vendors.

‘Necessary Measures’

The Senate resolution said the U.S. “will consider all necessary measures” to limit risks of the U.S. government or military using networks “compromised” by Huawei or ZTE gear. Secretary of State Mike Pompeo has said use of the Chinese manufacturers could jeopardize intelligence-sharing arrangements.

U.S. officials say Chinese communications equipment might be used for spying. Huawei has vigorously denied such allegations, and ZTE provided security guarantees last year after Trump lifted penalties imposed over accusations of sanctions violations.

Trump has said Huawei could be part of discussions with Xi at the G-20 summit that begins in Osaka on June 28. The countries are embroiled in a trade dispute, and Trump in a June 18 tweet said there will be an “extended meeting” without offering details.

Legislators have called for a firm hand. Senate Minority Leader Chuck Schumer earlier said Trump “needs to make it crystal clear to China that the United States takes this threat seriously and not use our national security as a bargaining chip.”

Senators Marco Rubio and Mark Warner -- both members of the Intelligence Committee -- this month sent a letter to Pompeo and U.S. Trade Representative Robert Lighthizer, warning them against using Huawei as a bargaining chip.

The Commerce Department last month put Huawei and more than 60 of its subsidiaries on its entity list, meaning American companies have to obtain a special license to sell components to the Shenzhen-based company -- and requests for such licenses are seldom approved. Trump has also signed an executive order restricting Huawei’s presence in U.S. networks.

To contact the reporters on this story: Todd Shields in Washington at tshields3@bloomberg.net;Daniel Flatley in Washington at dflatley1@bloomberg.net

To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net, Elizabeth Wasserman, Laurie Asséo

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