Chinese telecom firms Huawei and ZTE pose a security threat to the US, a congressional panel has warned after an investigation into the two companies. The House Intelligence report is highly critical of the two companies.
"China has the means, opportunity and motive to use telecommunications companies for malicious purposes," the report says. "Based on available classified and unclassified information, Huawei and ZTE cannot be trusted to be free of foreign state influence and thus pose a security threat to the United States and to our systems." The intelligence committee also accused both companies of providing "incomplete, contradictory, and evasive responses to the Committee's core concerns" during their nearly year-long investigation.
The two firms should be barred from any US mergers and acquisitions, according to a House Intelligence Committee report. The panel says the firms failed to allay fears about their association with China's government and military.
The firms - among the world's biggest makers of networking equipment - denied the accusations in front of the panel. China's Foreign Ministry urged the US to "set aside prejudices" regarding the two firms.
Huawei was started by Ren Zhengfei, a former member of the People's Liberation Army, in 1987. As the firm has grown to become one of the largest global players in the sector, fears about its ties with the Chinese military have frequently surfaced. Earlier this year, it along with ZTE, faced allegations that some of their equipment had been installed with codes to relay sensitive information back to China. ZTE is also facing accusations it sold US telecoms equipment to Iran, in breach of US sanctions. Telecoms giant Cisco on Monday ended its relationship with ZTE, Reuters reported, after its equipment was included in the Tehran deal. 
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