Huawei partner offered banned HP gear to Iran

Written by Reuters | Updated: Jan 2 2013, 02:47am hrs
A major Iranian partner of Huawei Technologies offered to sell at least 1.3 million euros worth of embargoed Hewlett-Packard computer equipment to Iran's largest mobile-phone operator in late 2010, documents show.

Chinas 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 criticised by the US House Intelligence Committee for failing to provide evidence to support its claims that it complies with all international sanctions or US 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 companys 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, had submitted it to MCI.

The statement went on to say, Huaweis business in Iran is in full compliance with all applicable laws and regulations including those of the UN, US and EU. 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 Irans second largest mobile operator, MTN Irancell, in a deal the buyer ultimately rejected. The US 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 US laws and sanctions.

Huawei has a similar partnership with HP. In a statement, the 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 companys relationship with Huawei is no different.

The statement added, HPs distribution contract terms prohibit the sale of HP products into Iran and require compliance with US 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 programme is aimed purely at producing domestic energy.

Huawei and its Iranian partner, Skycom, appear to have very close ties.

An Iranian job recruitment site called Irantalent.com describes Skycom as a leading telecom solution provider and goes on to list details that are identical to the way Huawei describes itself on its US website: employee-owned, selling solutions used by 45 of the world's top 50 telecom operators and serving one-third of the world's population.

On LinkedIn.com, several telecom workers list having worked at Huawei-skycom on their resumes.