US Charges Huawei With Theft of Trade Secrets

The U.S. has charged Huawei with theft of trade secrets. (Image: Screenshot / YouTube)
The U.S. has charged Huawei with theft of trade secrets. (Image: Screenshot / YouTube)

The United States government has charged Chinese tech company Huawei and its subsidiaries with violating anti-racketeering laws and conspiring to steal trade secrets from American companies. Huawei apparently stole IPs from six U.S. firms, involving products like robot testing technology, Internet routers, and antennas.

Theft campaign

“Prosecutors said the company used various means of ‘fraud and deception’ to achieve this [theft], including entering into confidentiality agreements with IP owners and then violating those agreements by using the IP for its own commercial use; recruiting former employees of target companies to gain access to IP from those companies; and using proxies such as professors working at target research institutions or companies to obtain IP,” according to The Epoch Times.

Huawei also ran a scheme where employees who stole trade secrets of its competitors with the highest value would be rewarded with bonuses. Once the sensitive information was obtained, Huawei incorporated it into its business. This allowed the company to significantly cut down research and development costs, giving them an unfair financial advantage over competitors. The company devised ways to hide such blatant IP theft from being discovered. Employees were asked to conceal their employment with Huawei when dealing with law enforcement officials.

The indictment also includes new charges against Huawei for doing business with countries that have been sanctioned by the United States, European Union, or the UN. This includes regimes like Iran and North Korea. Huawei apparently shipped its goods to the two nations through local affiliates in these countries and tried hard to cover its tracks. The U.S. had already placed the company under a trade blacklist in 2019. The new indictment only piles up U.S. pressure against Huawei.

Huawei helped the Iranian regime to monitor protestors in 2009. (Image: Kjetil Ree via wikimedia CC BY-SA 3.0)

“Huawei employees also allegedly lied about Huawei’s relationship to Skycom, falsely asserting it was not a subsidiary of Huawei. The company further claimed that Huawei had only limited operations in Iran and that Huawei did not violate the U.S. or other laws or regulations related to Iran. In fact, the indictment alleges Skycom was Huawei’s unofficial subsidiary that, among other services, assisted the Government of Iran in performing domestic surveillance, including during the demonstrations in Tehran in 2009,” The DoJ said in a statement.

5G issue

Mark Esper, the U.S. Defense Secretary, recently warned that America’s alliance with NATO will be in serious jeopardy if European nations go ahead and allow Huawei to establish 5G networks in their countries. He believes that too many countries are blinded by short-term gains and they are unable to see the long-term threat to security. His warning comes on the back of similar remarks by U.S. Secretary of State Mike Pompeo.

Mark Esper warns that the U.S.-Nato alliance might end up in trouble if Huawei 5G is allowed into Europe. (Image: wikimedia / CC0 1.0)

“We are encouraging allied and U.S. tech companies to develop alternative 5G solutions and we are working alongside them to test these technologies at our military bases as we speak… Developing our own secure 5G networks will outweigh any perceived gains from partnering with heavily subsidized Chinese providers that answer to party leadership,” Esper said in a statement (The Guardian).

The United Kingdom’s decision to allow Huawei 5G network has not gone down well with Australia. MPs from the country canceled a scheduled trip to London. The U.S. is sending officials to talk with the British administration and put pressure so as to make the UK change its position on the matter. If it fails and the UK ends up siding with Huawei, it will inevitably cause a big rift in intelligence sharing between the U.S. and its allies. 

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