China Power

Huawei in Trouble?

Cyber security analyst Jeffrey Carr reports on claims that IT firm Huawei may have engaged in bribery.

I’ve just received an email from cyber security analyst Jeffrey Carr about leading Chinese IT company Huawei and allegations that it may have been engaged in bribery. Huawei, which has its headquarters in Shenzhen, is the biggest network and telecoms equipment supplier in China. According to the company’s website, their products have served 45 of the world's top 50 telecoms operators.

Carr, founder and CEO of Taia Global and author of Inside Cyber Warfare, told me he’ll have more on this later. As I say, at the moment these appear to just be allegations being made against Huawei by Austrian magazine Format, but hopefully we’ll know more soon. In the meantime, though, here’s what Carr wrote on his site:

‘Huawei's meteoric rise to one of the top three information and communication technology companies in the world is due in large part to its ability to undercut bids by other companies thanks to its status with the Chinese government as a ‘national champion’ firm. However, in the case of its sales to Telekom Austria (A1TA) between 2007 and 2009, it may also be due to bribery.

‘An investigative report by reveals that Huawei Austrian CEO signed an agreement to pay a ten percent ‘marketing fee’ to Peter Hochegger, a former Austrian government lobbyist and PR consultant for all the A1TA business that he could deliver. Hochegger's influence and Huawei's money resulted in sales of over 130 million euros for the Chinese company, beating out regular Telecom Austria suppliers like Ericsson and Nokia Siemens Networks. According to an investigative report by, once A1TA paid Huawei, Huawei Austria's CEO transferred 10 percent to a bank account at the Bank of Cyprus. The account belonged to Astropolis, a company owned by Hochegger and his associates. 

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‘A1TA is now investigating all of its transactions with Huawei for possible criminal prosecution against the company. Not surprisingly, no one at Huawei is talking. The former head of Huawei Austria, Lu Hongwei, has moved to the top position at Huawei Serbia and is ‘unavailable.’ Sun Zhengyang, his successor, has no comment.’

Heise online 5 Apr 2011: 31 Mar 2011: 04 Apr 2011: