China‘s Huawei, the world’s second largest telecommunications equipment maker, says neither it nor its partner, a private company registered in Hong Kong, ultimately provided the HP products to the telecom, Mobile Telecommunication Co of Iran, known as MCI. Nevertheless, the incident provides new evidence of how Chinese companies have been willing to help Iran evade trade sanctions.
The proposed deal also raises new questions about Shenzhen-based Huawei, which recently was criticized by the U.S. House Intelligence Committee for failing to “provide evidence to support its claims that it complies with all international sanctions or U.S. export laws.”
At least 13 pages of the proposal to MCI, which involved expanding its subscriber billing system, were marked “Huawei confidential” and carried the company’s logo, according to documents seen by Reuters. In a statement to Reuters, Huawei called it a “bidding document” and said one of its “major local partners,” Skycom Tech Co Ltd, had submitted it to MCI.
The statement went on to say, “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.”
In October, Reuters reported that another Iranian partner of Huawei last year tried to sell embargoed American antenna equipment to Iran’s second largest mobile operator, MTN Irancell, in a deal the buyer ultimately rejected. The U.S. antenna manufacturer, CommScope Inc, has an agreement with Huawei in which the Chinese firm can use its products in Huawei systems, according to a CommScope spokesman.
He added that his company strives to comply fully with all U.S. laws and sanctions.
Huawei has a similar partnership with HP. In a statement, the Palo Alto, Calif., company said, “HP has an extensive control system in place to ensure our partners and resellers comply with all legal and regulatory requirements involving system security, global trade and customer privacy and the company’s relationship with Huawei is no different.”
The statement added, “HP’s distribution contract terms prohibit the sale of HP products into Iran and require compliance with U.S. and other applicable export laws.”
Washington has banned the export of computer equipment to Iran for years. The sanctions are designed to deter Iran from developing nuclear weapons; Iran says its nuclear program is aimed purely at producing domestic energy.