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24 May 2022

Canada bows to the inevitable and bars Huawei from 4G and 5G networks

When the USA first tightened its restrictions on Chinese vendors being part of any 5G networks, Canada did not fall into line as expected, and maintained an independent stance. This was despite US pressure to align its 5G cybersecurity policy with fellow members of the ‘Five Eyes’ intelligence partnership, which also includes the UK, Australia and New Zealand.

Those three countries all quickly agreed to support the USA’s wish to exclude Huawei’s equipment from most 5G networks, and now Canada has finally fallen into line too, barring Huawei and ZTE from 4G and 5G deployments.

Not only are operators barred from using designated equipment or services provided by Huawei and ZTE, but if they already have this gear installed, they will need to remove it by the end of June 2024 from 5G networks, and by the end of 2027 from 3G and 4G.

Canada had already excluded Huawei and ZTE from “sensitive areas” of 3G and 4G networks and had imposed assurance testing in independent labs even in less sensitive use cases, while also restricting the procurement of outsourced managed services from the two suppliers.

The reasons for the US-led sanctions against Chinese 5G are complex. The official justification relates to cybersecurity fears and accusations of Huawei being under the influence of the Chinese military and intelligence agencies (which Huawei denies), But the policies are also tied up with trade wars between the USA and China, and the desire of both countries to dominate the 5G and future 6G race, and to build large homegrown industries around that effort.

Canada will have similar pressures, on a smaller scale, and is now looking to bar the Chinese vendors from its FTTX roll-outs as well as mobile. “The Government of Canada has serious concerns about suppliers such as Huawei and ZTE who could be compelled to comply with extra-judicial directions from foreign governments in ways that would conflict with Canadian laws or would be detrimental to Canadian interests,” the government said in a statement.

The formal decision was announced on Thursday by François-Philippe Champagne, Canada’s minister of innovation, science and industry. “The Government of Canada is ensuring the long term safety of our telecommunications infrastructure,” he stated. “As part of that, the government intends to prohibit the inclusion of Huawei and ZTE products and services in Canada’s telecommunications systems. This follows a thorough review by our independent security agencies and in consultation with our closest allies.”

Relations between Canada and China in the 5G arena have been strained since Canada acceded to the USA’s request to arrest and detain Huawei’s CFO, Meng Wanzhou, on charges of fraud (she was released from house arrest after two years).

Canadian operators have traditionally been a strong source of business for Chinese vendors, especially Huawei. However, given the developments south of the border, the MNOs have been preparing for restrictions on Chinese equipment and services. Telus, a user of Huawei 4G, has introduced Samsung to its 5G supply chain, though it appears to be using mainly Ericsson and Nokia kit. It has not officially dropped Huawei from its 5G line-up but has recently refused to comment on the issue.

In June 2020, Bell Canada said Ericsson would be its main 5G supplier, having previously bought 4G RAN from Huawei. The company commented at the time: “Huawei has been a reliable and innovator partner in the past and we would consider working with them in 5G if the federal government allows their participation.”

Rogers also announced that Ericsson would be its lead 5G supplier, back in 2018, and its vice-chair Philip Lind said, in 2020, that Huawei poses a threat to Canada and should be banned from national 5G networks.