US probes Huawei, ZTE over spy concerns

American lawmakers continue probe of Chinese telecom equipment vendors over espionage concerns and their motivation to expand presence in country, report states.

U.S. lawmakers are once again investigating telecom equipment makers Huawei Technologies and ZTE over their relationships with the Chinese government, as well as five U.S. consulting firms and work done in Iran.

The Wall Street Journal (WSJ) reported on Tuesday that lawmakers from the U.S. House Intelligence committee--led by Mike Rogers and Dutch Ruppersberger--had issued letters to both companies stating its concerns over their ties with the Chinese government, including there being a "party committee" representing the government within Huawei.

The committee also questioned Huawei's relationships with five U.S. consulting firms including IBM and Accenture, as well as both companies' work in Iran, the report noted.

Ruppersberger stated that the committee is "concerned" the Chinese government is hacking into the country's networks via its telecom intermediaries, while Rogers highlighted that the Chinese companies provide opportunities for foreign and economic espionage.

Both Chinese companies told WSJ that their interaction with the Chinese government is typical of regulated companies in China. Huawei said that it is beginning to review questions posed by lawmakers, while ZTE stated that it is committed to "remaining transparent, candid, and cooperative" throughout the inquiry.

This is not the first time the House Intelligence committee had launched investigations. Last November, it launched a probe to assess potential threats to national security posed by China's networking vendors' presence and expansion in the country.

The level of distrust between these two global economic powerhouses might hamper their efforts to develop policies and mechanisms to increase online security. Security observers told ZDNet Asia that the lack of trust between ally governments will make international security agreements difficult to enforce.