Huawei caught up in legal mess over cell equipment sales to Iran

The company's partner reportedly acquired some tower antenna equipment from a U.S.-based firm and then tried to sell it to an Iranian carrier.

Don Reisinger
Former CNET contributor Don Reisinger is a technology columnist who has covered everything from HDTVs to computers to Flowbee Haircut Systems. Besides his work with CNET, Don's work has been featured in a variety of other publications including PC World and a host of Ziff-Davis publications.
Don Reisinger
2 min read

Huawei, the embattled Chinese telecommunications equipment maker, has been caught in a convoluted tale over Iranian cellular sales.

Earlier this year, Huawei purchased cellular antenna equipment from a U.S.-based company, called Andrew LLC, and then through a partner in Iran, attempted to sell those products to a carrier in the Middle Eastern country, Reuters is reporting today, citing documents it obtained from unidentified sources. The carrier apparently cancelled the sale for fear of violating U.S. sanctions.

CNET has contacted Huawei for comment on the Reuters report. We will of course update this story when we have more information.

But according to Reuters, Andrew is owned by CommScore, a company that sells a host of wireless products. CommScore reportedly had an agreement in place with Huawei that delivered a large order of Andrew components to the Chinese firm with the understanding that they could not be sold to companies in Iran, per sanctions on U.S.-based products being banned from sale in that country.

Reuters claims that an Iranian-based Huawei partner, Soda Gostar Persian Vista, tried earlier this year to sell some of Andrew's products to Iranian carrier MTN Irancell. Before the transaction was completed, MTN Irancell reportedly determined that the products had come from the U.S. and cancelled the deal.

In a statement to Reuters, MTN Irancell parent company, MTN Group, acknowledged that the company had ordered antennas through Huawei's partner, but thought that the products would come from Germany. In its own statement to Reuters, Huawei said only that it didn't finalize the deal because it "has been and continues to be in strict compliance with all relevant international and local laws and regulations."

Huawei has come under fire in the U.S. as it attempts to sell its wireless-networking equipment stateside. During hearings with U.S. lawmakers, the motives of Huawei and another China-based company, ZTE, were called into question, with politicians saying that the companies could use their equipment to spy on U.S. interests for the Chinese government. The lawmakers also expressed concern over the companies' alleged dealings with Iran.

Iran is subject to tight global sanctions that include a ban on receiving non-humanitarian products from the U.S. If a company is found to have sold U.S. products in Iran, it would violate several laws and a trade embargo.

Earlier this year, a report surfaced saying that the Federal Bureau of Investigation was investigating ZTE over whether it illegally shipped American-made products to Iran. Cisco, one of the companies that reportedly supplied equipment to ZTE, ended their partnership over those claims.