EU push to phase out ‘high-risk’ tech sparks backlash from China’s Huawei

The European Union has unveiled plans to phase out components and equipment from so-called “high-risk” technology suppliers across critical sectors, a move that has drawn criticism from China’s Huawei and added fresh strain to EU-China relations.

According to the draft proposal, released on Tuesday as part of revisions to the EU’s Cybersecurity Act, aim to strengthen defences against a rising wave of cyber and ransomware attacks, while reducing Europe’s dependence on non-EU technology providers.

Although the European Commission did not name any companies or countries, Chinese technology firms, particularly Huawei, are widely seen as being in the firing line.

“With the new Cybersecurity Package, we will have the means in place to better protect our critical (information and communications technology) supply chains but also to combat cyber attacks decisively,” EU tech chief Henna Virkkunen said in a statement.

Wide-ranging impact on critical sectors

Under the draft rules, the Commission has identified 18 key sectors that would fall under tighter cybersecurity oversight. These include electricity supply and storage systems, water infrastructure, connected and automated vehicles, detection equipment, drones and counter-drone systems.

Other areas deemed critical include cloud services, medical devices, surveillance equipment, space services and semiconductors.

If a supplier is formally designated as “high-risk”, mobile operators would be given 36 months from the publication of an official list to phase out key components. Timelines for fixed networks, such as fibre-optic and submarine cables, as well as satellite networks, will be set at a later stage.

No names, but China in focus

While Brussels avoided explicitly naming companies or countries, the context is clear. Europe has been steadily tightening scrutiny of Chinese technology over security concerns.

Germany has recently appointed an expert commission to reassess its trade policy towards China and has already banned the use of Chinese components in future 6G networks. At the transatlantic level, the United States banned approvals of new telecoms equipment from Huawei and ZTE in 2022 and has urged European allies to take similar steps.

The EU’s latest move builds on its 2020 “5G security toolbox”, which encouraged member states to limit the role of perceived high-risk vendors. Several countries, however, have yet to fully remove such equipment due to the high cost of replacement.

Huawei and Beijing cry foul

Huawei reacted, arguing that the proposals undermine the EU’s own legal principles.

“A legislative proposal to limit or exclude non-EU suppliers based on country of origin, rather than factual evidence and technical standards, violates the EU’s basic legal principles of fairness, non-discrimination, and proportionality, as well as its WTO (World Trade Organization) obligations,” a Huawei spokesperson said, adding that the company would “reserve all rights to safeguard our legitimate interests”.

China’s foreign ministry echoed that criticism. Spokesperson Guo Jiakun said Chinese firms had long operated in Europe in compliance with laws and regulations and had “never endangered Europe’s national security”. He urged the EU to avoid “going further down the wrong path of protectionism”.

Industry warns of higher costs

European telecoms operators have also voiced concern. Lobby group Connect Europe warned that the proposed phase-outs would increase the burden on the industry, with additional regulatory and replacement costs potentially running into billions of euros.

Despite those warnings, the Commission insists the measures are essential for long-term security and resilience.

“This is an important step in securing our European technological sovereignty and ensuring greater safety for all,” Virkkunen said.

With inputs from agencies.