(Reuters) – A ban on certain components by Chinese companies Huawei (HWT.UL) and ZTE (000063.SZ) could have a significant impact on Germany’s mobile network if they have to be replaced on a larger scale, according to a German economy ministry letter seen by Reuters.
The German government is currently carrying out a review of telecom tech suppliers which it says is not directed at specific manufacturers.
If extensive changes are required as a result of a ban or regulation, “there is likely to be significant impact on the operation of mobile networks and the fulfilment of coverage requirements,” said the letter to the Bundestag lower house of parliament’s economic committee.
The precise impact on mobile operators and other economic players is not possible to assess, the ministry added, as it depends on individual decisions as well as transition periods.
The government’s review could lead to operators being asked to remove and replace components already built into 5G networks. Under current legislation, they would not receive compensation.
Critics of Huawei and ZTE say that their close links to Beijing’s security services mean that embedding them in mobile networks could give Chinese spies and even saboteurs access to essential infrastructure.
Huawei, ZTE and China’s government reject such claims, saying they are motivated by a protectionist desire to support non-Chinese rivals.