Australia bans China's Huawei from project citing security reasons

Chinese telecoms giant Huawei has been blocked from tendering for equipment contracts with Australia's National Broadband Network (NBN) due to security concerns, a report said Monday.

The government refused to confirm the specifics of the Australian Financial Review (AFR) report. But a spokesman for Attorney-General Nicola Roxon said protecting the integrity of the ambitious NBN was of paramount importance.

"The National Broadband Network is the largest nation-building project in Australian history, and it will become the backbone of Australia's information infrastructure," Roxon's spokesman told AFP.

"As such, and as a strategic and significant government investment, we have a responsibility to do our utmost to protect its integrity and that of the information carried on it."

Huawei, which was founded by a former People's Liberation Army engineer, was instructed late last year by Canberra that it was banned from bidding for NBN equipment contracts, the AFR reported.

NBN Co., the government corporation implementing Australia's largest ever infrastructure project, had internally endorsed Huawei but the government intervened due to concerns over cyber-attacks from China, the AFR said.

Huawei's technology is used to build mobile phone networks around the world. It has repeatedly denied any links to the Chinese military, but has also run afoul of regulators and lawmakers in the United States.

There was no immediate comment from Huawei to the AFR report.

Officials say the Aus$35.9 billion ($37.5 billion) NBN will connect 93 percent of Australian homes to high-speed fibre Internet, with the remainder linked via fixed-wireless services and satellite.

Roxon's spokesman said Canberra's stringent approach to the network was "consistent with the government's practice for ensuring the security and resilience of Australia's critical infrastructure more broadly".

But the spokesman declined to comment further on "confidential" discussions with individual companies.

It is not the first time Asian cyber fears have hit major telecoms deals in Australia -- the 2001 takeover of Cable & Wireless Optus by Singapore's SingTel was heavily scrutinised due to espionage fears.

Singtel's links with Huawei, a major supplier of its equipment, also dogged Optus's bid to run the NBN before the government decided to fund it as a state project.

The computers of Australia's prime minister, foreign and defence ministers were all suspected of being hacked last March, with the attacks suspected to have originated in China.

Beijing dismissed the hacking allegations as "groundless and made out of ulterior purposes".