Thursday, 29 July 2021

Huawei loses round two of 5G dispute in Sweden

by Harry Baldock, Total Telecom
Thursday 24 June 21

The Swedish Administrative Court has decided to uphold the ban on Huawei selling 5G equipment in Sweden, rejecting the vendor’s appeals

Huawei’s disputes with Sweden began in earnest back in October 2020, when the Swedish regulator ruled that Huawei and fellow Chinese vendor ZTE would be banned from supplying equipment for the national operators’ upcoming 5G networks and required them to be removed from their existing networks by 2025. Naturally, Huawei appealed this ruling just one month later, arguing that the regulator was contravening European law by discriminating against them based on their nation of origin…

Huawei’s disputes with Sweden began in earnest back in October 2020, when the Swedish regulator ruled that Huawei and fellow Chinese vendor ZTE would be banned from supplying equipment for the national operators’ upcoming 5G networks and required them to be removed from their existing networks by 2025.

Naturally, Huawei appealed this ruling just one month later, arguing that the regulator was contravening European law by discriminating against them based on their nation of origin. By January 2021, however, Sweden’s Supreme Administrative Court had dismissed the appeals, ordering the country’s 5G spectrum auction to go ahead as planned. 

The 5G auction came and went, concluding in just one day, but Huawei continued to challenge the ban, filing a new appeal in April. 

Now, however, the Swedish Administrative Court has officially announced its decision to uphold the ban on 5G equipment, rejecting the latest round of appeals from the Chinese vendor. 

“Sweden’s security is of heavy importance and the administrative court has taken into account that only the security police and the armed forces together have an overall picture regarding the security situation and the threat to Sweden,” the court said in a statement.

For Huawei, this result comes as no real surprise, but the company has nonetheless indicated that they will continue to fight for their position in Sweden.

“It’s not unexpected based on the fact that the court is also leading their conclusions on basically the assumptions being made by SAPO,” Kenneth Fredriksen, Huawei’s Executive Vice President, Central East Europe and Nordic Region, told Reuters. “We will continue to fight for our right to be in the (Swedish) market.”

Interestingly, throughout this process, Huawei’s vendor rival Ericsson has emerged as a vocal supporter of Huawei’s right to participate in the Swedish market. The Swedish vendor has argued that the ban goes against the spirit of free market competition, leading to less competition and less choice for operators. However, there is also a very clear economic argument for Ericsson’s ongoing support; business in China accounts for around 10% of the company’s revenue, leaving them concerned that backlash from the Swedish ban could put their market position in jeopardy.

“It is the company's current assessment that the risk has increased that Ericsson will in those tenders be allocated a significantly lower market share than its current market share, said the company in a statement back in May.

In related news, Huawei was dealt another blow earlier this month when Romania announced it would go ahead with a law banning Huawei from the nation’s 5G networks.

But despite these European losses, it should be noted that Huawei still holds a powerful position in the global telecoms market. Recent data from Dell’Oro suggests that the company still holds a 36% revenue share for telecoms equipment outside of North America in Q1 of this year.

 

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Also in the news: 
Vodafone UK begins commercial standalone 5G pilot
London Underground to get mobile network as BAI prepares £1bn mobile boost
UK telecoms industry digging like never before for connectivity victory

 

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