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Japan to block use of Huawei, ZTE

Japan to block use of Huawei, ZTE

MONDAY, December 10, 2018

THE JAPANESE government intends to effectively ban products of two major Chinese telecommunications equipment makers – Huawei Technologies Co and ZTE Corp – from telecommunications devices at government ministries and agencies, the Self-Defence Forces and other entities, as their products have been described as posing a national security risk, The Yomiuri Shimbun has learned.

The Cabinet Office and ministries plan to make arrangements as early as yesterday to revise internal rules on government bodies’ procurement of these devices, according to sources. Halting the use of their products is aimed at preventing cyberattacks and the leaking of confidential information. With the enactment of the US National Defence Authorisation Act in August this year, that country began prohibiting the use of equipment and services by the two Chinese companies within government organisations and at companies conducting business with the government.
The US government has urged Japan and other allies to refrain from using the companies’ products such as mobile phones and semiconductors, saying they contain viruses that facilitate Chinese cyberattacks and illegal communication intercepts.
In response, the Japanese government plans to create a system in which it will refrain from purchasing products and services of companies that the government believes pose a national security threat, the sources said.
The government plans to avoid directly naming the two companies to prevent provoking China’s anger, but a government source said that Huawei and ZTE are the targets of the ban at the current stage. The government is also considering banning products by Japanese private companies that use parts made by the two Chinese companies.
A government source said it is possible that “mobile phones and semiconductors of the two companies are currently being used” by government-affiliated organisations.
Based on the arrangements, the Cabinet Office, ministries and agencies plan to revise internal rules on government bodies’ procurement of devices, including communication lines and personal computers.
Specifically, the government is considering introducing a comprehensive evaluation system that awards contracts based on factors other than prices, such as technological capabilities, and including “mitigating national security risks” in the criteria for judging bids. Ordinary competitive bids based on prices will not be offered. However, if the two companies’ products are widespread in the private sector – including the defence industry and companies operating important social infrastructure such as electric power generation – it could cause greater damage in the event of a cyberattack.
For that reason, the government is also looking at establishing a new supply chain in cooperation with the United States and Australia to procure parts mainly for communication equipment and semiconductors from countries other than China.
In addition to the United States, Australia and New Zealand are planning to ban the equipment of Huawei and others from their planned 5G next-generation mobile network.