Chinese telecommunications firm Huawei has found itself in hot water once again, with allegations emerging that it has been illegally supplying equipment to Iran in direct contravention of trade sanctions against that country.
According to documents acquired by Reuters, Huawei apparently delivered an “expansion proposal” to Iran’s leading mobile operator MCI via one of its main Iranian partners. The documents bore Huawei’s logos and listed equipment including 20 disk arrays, a server, 22 switches and software valued at a total cost of €1.3 million. In addition, the document referred to “existing” HP equipment that MCI already owns, including 8 disk arrays, 22 servers and 13 switches, coming to a total value of €19.9 million.
Iran is currently under sanctions imposed by the USA that prevent any US company from exporting computer equipment to the country, in order to curtail its nuclear ambitions. Hundreds of foreign firms, including Huawei, are also obliged to adhere to the sanctions if they wish to continue doing business in the US.
Reuters says that the proposal appears to have been set up by a firm called Skycom Tech, a Hong Kong-based firm that acts as its main Iranian partner. Huawei admitted to Reuters that the proposal was genuine, describing it as a “bidding document”, but denied that it or Skycom had gone ahead with shipping any hardware to Iran.
“Huawei’s business in Iran is in full compliance with all applicable laws and regulations including those of the U.N., U.S. and E.U. This commitment has been carried out and followed strictly by our company. Further, we also require our partners to follow the same commitment and strictly abide by the relevant laws and regulations,” said Huawei in a statement to Reuters.
The allegations come at an inopportune moment for Huawei, which is still reeling from a US Congressional Panel’s declaration that the Chinese firm was a “security risk” for US companies, as its technology could easily be hacked by Chinese agents.
Huawei seems to have a long history of struggling to comply with US and international sanctions. Last October we reported that the Chinese firm almost sold three dozen antennas to MTN Irancell, a deal that would have contravened US sanctions had the Iranian telecommunications firm not pulled out at the last minute, claiming it had made a mistake with that order.
Also last year, there was controversy over the company’s decision to sell mobile phone tracking equipment to Iranian mobile operators, causing US lawmakers to call for an investigation amid concerns that Huawei was “facilitating the Iranian government’s restriction of free speech”. Last October, Huawei was again attacked by a US House Intelligence Committee for its failure to provide evidence that it complies with international sanction.
Huawei’s sanction-busting antics appear to stretch back much further too, with Techcrunch pointing to a 2003 article in the New York Times accusing the firm of helping Saddam Hussein’s Iraq to acquire embargoed hardware.