Huawei says the government has informed the company that it, along with fellow Chinese telecommunications equipment provider ZTE, has been banned from providing 5G technology to Australia's telcos.
The government this morning released a statement saying it had provided 5G security guidance to Australian telecommunications carriers.
Although the statement, issued by communications minister Senator Mitch Fifield and acting home affairs minister Treasurer Scott Morrison, did not mention either firm by name, a possible ban of Huawei — a major supplier of 4G equipment in Australia — in particular has been long rumoured to be on the cards.
In 2012 the company was barred by the government from participating in the National Broadband Network's rollout. National security concerns were cited as the reason for the ban.
The government today said that it had “undertaken an extensive review of the national security risks to 5G networks”.
In contrast to previous generations of cellular technology, 5G has an increased “potential for threats to our telecommunications networks” and “these threats will increase over time as more services come online” the statement from Fifield and Morrison said.
“The security of 5G networks will have fundamental implications for all Australians, as well as the security of critical infrastructure, over the next decade,” Morrison said.
Last year the government passed legislation to implement its Telecommunications Sector Security Reforms (TSSR), giving it extensive powers to issue directions to telcos regarding the security of their networks.
That legislation enshrined a formal legal obligation for telcos to protect their networks from threats including espionage, sabotage and foreign interference.
It also gave the government the power to direct a telco to do, or not do, a specified thing that may impact on security. An explanatory memorandum accompanying the TSSR legislation gave as an example a direction to “alter a procurement assessed as giving rise to security risks”
“Currently national security risks to the telecommunications sector are largely managed through informal cooperative arrangements with industry,” stated a memorandum accompanying the Telecommunications and Other Legislation Amendment Bill.
“Security agencies have well established cooperative relationships with select carriers, and work collaboratively with these carriers to manage vulnerabilities on these networks. However, there are significant limitations to this approach. A voluntary or cooperative approach is only workable where companies are willing to give due consideration to national security and the public interest.”
Huawei is yet to issue a lengthy comment on the decision but the Huawei Australia Twitter account said it was an “extremely disappointing result for consumers”. The company said that it is a world leader in 5G and has safely and securely delivered wireless technology in Australia for close to 15 years.
“The government’s Telecommunications Sector Security Reforms, which commence on September 18, place obligations on telecommunications companies to protect Australian networks from unauthorised interference or access that might prejudice our national security,” Morrison said.
Huawei has previously indicated it was interested only in supplying equipment for the Radio Access Network portion of 5G deployments.
However, the government argues that 5G will increasingly blur the boundaries between a network’s edge and core.
“This shift introduces new challenges for carriers trying to maintain their customers’ security, as sensitive functions move outside of the highly protected core environment,” the government’s statement said.
“This new architecture provides a way to circumvent traditional security controls by exploiting equipment in the edge of the network – exploitation which may affect overall network integrity and availability, as well as the confidentiality of customer data’”
There government said it had found no combination of security controls that would sufficiently mitigate the risks.
The statement adds: “While we are protected as far as possible by current security controls, the new network, with its increased complexity, would render these current protections ineffective in 5G.
“Therefore, Government has expectations of the application of the TSSR obligations with respect to the involvement of third party vendors in 5G networks, including evolution of networks leading to mature 5G networks.”
The government said that it considered the “involvement of vendors who are likely to be subject to extrajudicial directions from a foreign government that conflict with Australian law, may risk failure by the carrier to adequately protect a 5G network from unauthorised access or interference.”
The line is a barely veiled reference to China’s national intelligence law that requires all organisations to “support, cooperate with, and collaborate in national intelligence work, and guard the secrecy of national intelligence work they are aware of.”
Huawei Australia chair, John Lord, has claimed that that law “has no legitimacy outside China” and “contains safeguards that discharge individuals and organisations from providing support that would contradict their legitimate rights and interests.”
Huawei had pushed for the launch of an Australian evaluation centre that would allow the security of telecommunications equipment to be assessed.
The company has also noted that much of the equipment from its competitors is also manufactured in China.
Regardless of whether Huawei participates in the rollout of 5G networks in Australia, much of the equipment used by local telcos will be made in China, Lord said during a National Press Club address earlier this year.
The government’s decisions leave Huawei’s rivals Nokia and Ericsson to take leading roles in the rollout of 5G.
“Nokia is a global 5G leader with a massive innovation engine, complete technology portfolio and a strong presence in Australia,” said Nokia Oceania head of corporate affairs, Tim Marshall, in a statement released this morning.
“Security is paramount and everything we do is managed under a transparent global system of integrity. We have strong relationships with all Australian carriers and will obviously be working closely with them to help understand how these new laws will be implemented.”