Letter to EU telecom and trade ministers, and to European Commission Executive Vice Presidents Margrethe Vestager and Valdis Dombrovskis, and Commissioner Thierry Breton

Brussels, 28 October 2020

It came to our attention that, on 14 October, 41 Members of the European Parliament (MEPs) signed a letter to express their concerns about two Chinese 5G vendors, which are also member of the China Chamber of Commerce to the EU (CCCEU).

In their message, the MEPs identified alleged unfair competition between European and Chinese 5G providers and stated that "Huawei and ZTE are 'high-risk' vendors, whose technology in Europe's 5G networks would constitute a security threat." After carefully reviewing the letter, we would like to present our views.

The documents previously released by the European Commission, namely the EU toolbox on 5G Cybersecurity and the following reports, put forward evidence-based considerations for risk assessment and evaluation of 5G providers. These do not include any geographical relations to a country, be it the country of origin or the headquarters' location. Unfortunately, the abovementioned letter categorized Huawei and ZTE as "high-risk vendors" on the mere basis of their geographic origin.

We are disappointed to see that this matter – which has an intrinsically commercial and technical nature – is being politicised at the moment. In fact, the politicisation of any commercial or business matter would hamper any fact-based analysis, thus possibly leading to ungrounded decisions. Therefore, political arguments and other generalisations should be avoided when addressing highly technical matters.

We also noticed that the letter refers to an alleged "blatant lack of reciprocity between the EU and China in the market access of 5G vendors." The truth is that Ericsson and Nokia have been deeply and widely engaged in the Chinese telecom market: they participated in the construction of China's 2G, 3G and 4G core networks. Besides remaining open to their activities and investment, Chinese authorities never expressed concerns over possible cybersecurity threats. At the moment, Ericsson and Nokia are participating in the ongoing 5G rollout in China. In the past spring, for instance, Ericsson won contracts for the rollout with China Telecom, China Mobile and China Unicom. This summer, China Unicom selected Nokia to supply around 10% share of its 5G core network.

The message from the MEPs seems not in line with the EU's support for openness and cooperative approach it has held towards China, especially in light of the recent high-level dialogue on the digital economy. Any discriminatory and possibly xenophobic attitude would violate EU law in many respects, such as the free movement of goods and services, fundamental right to property, and the freedom to conduct business.

Digital technologies are now part of our economies, societies and daily lives, and being up to date in the digital domain has proved to be key for all countries worldwide, but also a challenge. Cooperation on digital matters is fundamental for developing these capabilities on time, for sharing their expensive costs, and for benefiting from win-win outcomes. Diversification is critical to guarantee a competitive market for European consumers, where they can benefit from lower prices, better products, and wider choice.

As a platform for dialogue and cooperation between China and the EU, the China Chamber of Commerce to the EU (CCCEU) would welcome closer dialogue and opinion exchanges on these topics, in particular on how to achieve a competitive market without discrimination.

The pandemic situation is still bad, but with the dedicated efforts by all government levels we will see the light at the end of the tunnel. We wish you all the best.

Yours sincerely,

Zhou Lihong

Chairwoman of the CCCEU