Facing U.S. Charges, Huawei Holds Onto Australian Tech Deal

(Bloomberg) -- Western Australia is pressing ahead with a $141 million contract with Chinese telecommunications group Huawei even after it was banned from the country’s 5G network by the federal government.

The state’s Transport Minister Rita Saffioti said she sought advice from intelligence agencies on the contract after Huawei was indicted in the U.S. in January. She also held talks with senior Huawei Technologies Co. officials after the allegations were filed, in part seeking assurances it could still deliver the digital radio system for a metropolitan rail system.

“We have got the right advice,” Saffioti said in Perth on Thursday. “We are managing the contract.”

Huawei has repeatedly denied that it helps Beijing spy on other governments or companies, and points out that no one has provided any proof to support such charges.

The state awarded the contract to Huawei and joint venture partner UGL Ltd in July. In August, Australia banned Huawei from supplying 5G equipment to its telecom operators, on national security grounds. In January, prosecutors in the U.S. filed criminal charges against the Chinese company alleging it stole trade secrets from an American rival and committed bank fraud by violating sanctions against doing business with Iran.

Opposition Liberal Party leader Mike Nahan said on Wednesday the public had been kept “in the dark on this critical national security issue,” according to an official transcript from the state’s parliament.

The U.S. also alleges Huawei sold telecommunications equipment that China’s ruling Communist Party could use for espionage, allegations that China has strongly denied.

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