EU mulls probe into China telecom makers' biz practices

EU mulls probe into China telecom makers' biz practices

Summary: European Union trade chief Karel De Gucht is looking to raise support from other members within the European Commission to look into alleged unfair trade practices from Chinese telecom equipment makers.

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European Union (EU) trade chief Karel De Gucht is reportedly looking to seek support from European Commission members to look into supposed unfair trade practices by Chinese telecom equipment makers Huawei Technologies and ZTE. However, he faces opposition from European companies looking to grow their businesses in China.

A Wall Street Journal report Monday, citing an unnamed EU official, said De Gucht will broach the topic of having the necessary backing by EC members to look into alleged unfair trade practices by the Chinese companies during their weekly meetings on Wednesday.

Europe has been suspecting Huawei and ZTE are using subsidies from the Chinese government, such as cheap credit from state-owned banks, to sell their goods at unfairly low prices and snatch market share in the region, the report noted.

The unnamed source added De Gucht has not decided on whether to launch the probe, while European officials are also closely monitoring whether European telecom gear makers are winning business contracts in China during this time.

Ericsson, for one, opposed any such investigstion. Ulf Pehrsson, head of government and industry relations at Ericsson, told Wall Street Journal: "We don't believe in this type of unilateral measure. Ericsson is supporting global rules that apply for all industry players. The EU faces the risk of initiating a negative spiral by targeting individual firms."

The Swedish telecoms manufacturer clinched a deal to build a TD-LTE network for China Mobile Hong Kong, a subsidiary of China Mobile, last July.

 

 

 

Topics: Government, Legal, Networking, Telcos

Kevin Kwang

About Kevin Kwang

A Singapore-based freelance IT writer, Kevin made the move from custom publishing focusing on travel and lifestyle to the ever-changing, jargon-filled world of IT and biz tech reporting, and considered this somewhat a leap of faith. Since then, he has covered a myriad of beats including security, mobile communications, and cloud computing.

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2 comments
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  • EU Hypocrisy

    From the article above, "Europe has been suspecting Huawei and ZTE are using subsidies from the Chinese government, such as cheap credit from state-owned banks, to sell their goods at unfairly low prices and snatch market share in the region, the report noted".

    Isn't that how Airbus operates??
    ReadandShare
    • kindda different

      Well China can impose the levy on Airbus and Boeing as well. However there's no local company in China (or anywhere else that I know of) that produces Airplanes that can compete with those two. This then creates a duopoly where both companies can set a certain price on their products and no one will/can complain about it as there are no other companies' product to compare to. Funnily enough, if China do go ahead and apply a levy to airbus or boeing products, I can imagine the two company will simply pass it on to their Chinese customers, which means they will pay more for their new airplanes :)

      Unlike airlplanes, there are a number of vendors in the telecommunication market. Mainly from EU and China.
      Howiedoin