Senators question potential Sprint-Huawei deal

A group of Republican senators have asked the Obama administration to take a closer look at whether a potential deal between Sprint Nextel (NYSE:S) and Chinese vendor Huawei will compromise national security. 

"We are concerned that Huawei's position as a supplier of Sprint Nextel could create substantial risk for U.S. companies and possibly undermine U.S. national security," wrote Sens. John Kyl (R-Ariz.), Christopher S. Bond (R-Mo.), Richard C. Shelby (R-Ala.), Jeff Sessions (R-Ala.), James M. Inhofe (R-Okla.), Jim Bunning (R-Ky.), Richard M. Burr (R-N.C.) and Susan Collins (R-Maine) in a letter.

The senators brought up concerns about Huawei's ties to the Iranian government and the Chinese military--ties that Huawei has strongly denied. A Huawei spokeswoman, Jannie Nguyen, told FierceWireless that Huawei "abides by and respects third-party intellectual property rights (IPR) and strives for continuous innovation to maintain our leadership position."

She said that company has not been found in violation of IPR infringement by any court in any country and has not been found to have acquired inappropriately any third-party proprietary information. Additionally, she said the company "has a comprehensive trade compliance organization, policies and operation system, and strictly complies with all the laws, regulations, and related trade compliance regulations established by the UN and all the countries where we operate including the U.S. This also applies to Iran, where our business operation is similar to other Western vendors in the market."

A Sprint spokesman declined to comment.

Recent reports have indicated that both the U.S. government and Huawei are trying to figure out the best approach to take if Huawei decides to become further enmeshed in the U.S. market. According to a recent report in the Wall Street Journal, Huawei hired a raft of U.S. advisers to help it overcome security concerns. The report said Huawei tapped several law firms that specialize in telecom, mergers and winning federal approval for sensitive international deals.

In July, the Financial Times reported that Huawei is bidding on a significant wireless contract with Sprint. The report, citing unnamed sources familiar with the matter, did not say what kind of equipment was under discussion, nor did it say if, or when, a decision regarding the contract would be made.

For more:
- see this Washington Times article

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Article updated Aug. 20 with comments from Huawei.

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