Germany won't agree on 5G rules before summer break

Friday, June 26, 2020
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Some lawmakers argue that China's Huawei [HWT.UL] poses a threat to national security and want to exclude it altogether, but Chancellor Angela Merkel's coalition government is divided over the guidelines for foreign vendors.

"There will be no cabinet decision on the IT security law next week," a government official told Reuters, meaning the Bundestag lower house will not be able to discuss the law before the summer break.

The Bundestag meets on July 3 for the last time before its summer recess, and reconvenes in September.

The interior ministry has written up a draft law that sets out minimum requirements for vendors and says they must be "trustworthy".

Huawei, under pressure from wider sanctions imposed by the United States designed to disrupt its chip supply chain, faces challenges in meeting its supply commitments to major 5G customers including Germany's leading mobile operators, Deutsche Telekom, Vodafone and Telefonica Deutschland.

Britain, which is reviewing a decision taken in January to cap Huawei's share of radio access networks at 35%, last week advised telecommunications firms to ensure they have adequate stockpiles of Huawei equipment.

Deutsche Telekom, Huawei's largest customer in Europe, has argued against any blanket bans on individual foreign vendors.

But analysts say that the tougher U.S. sanctions may prompt European mobile operators to reconsider their relationship with Huawei, regardless of what politicians decide.

(Reporting by Andreas Rinke and Douglas Busvine; Writing by Madeline Chambers; Editing by Kevin Liffey)