Huawei Rotating Chairman Guo Ping (center) speaks in front of other executives at a press conference in Shenzhen, China's Guangdong Province on Thursday. Huawei is launching a US court challenge to a law that labels the company a security risk and would limit its access to the US telecoms equipment market. (Photo: AP)
China's Huawei Technologies announced on Thursday it has sued the US government for "unconstitutional sales restrictions imposed by the US Congress," reflecting its efforts to turn a crisis into an opportunity, which will also help shape unified global standards for cybersecurity.
The Shenzhen-based company filed a lawsuit in a US District Court in Plano, Texas, seeking a declaratory judgment that the restrictions targeting Huawei are unconstitutional, and a permanent injunction against these restrictions.
"The US Congress has repeatedly failed to produce any evidence to support its restrictions on Huawei products. We are compelled to take this legal action as a proper and last resort," Guo Ping, the company's rotating chairman, said at a press conference in its headquarters in South China's Guangdong Province.
Huawei filed a lawsuit to challenge the constitutionality of Section 889 of the 2019 National Defense Authorization Act (NDAA), which not only restricts Huawei from serving US customers, but also deprives Huawei of opportunities to serve customers outside the US as the law bars US government agencies from contracting with or awarding grants or loans to third parties who buy Huawei equipment and services.
Chinese Foreign Ministry spokesperson Lu Kang said at a routine press conference on Thursday that Huawei's lawsuit is reasonable, and companies have the right to protect their legitimate interests through legal means.
"When the US passed the 2019 NDAA last year, China has already made solemn representations to the US regarding the China-related part of the act," Lu said.
The 2019 NDAA was passed by the House on July 26 and the Senate on August 1 last year. US President Donald Trump signed the act on August 13, 2018.
"It's not an easy move for Huawei, and received suggestions from high-ranking people," Song Guoyou, director of Fudan University's Center for Economic Diplomacy, told the Global Times.
The lawsuit is often very abstract, which usually involves judicial interpretation, Song noted. "Huawei will refer to previous cases… Difficulties do not necessarily mean failure. For example, Sany won its case against former US President Barack Obama," he said.
China's Sany Group sued Obama in 2012, arguing that the presidential order to stop the project of Sany's affiliated company Ralls was unconstitutional, and reached a favorable settlement in 2015.
The US government has launched a multifaceted global geopolitical campaign in cracking down on Huawei, which has a significant presence in overseas markets, with half of its revenues earned abroad.
"Huawei is doing the right thing," Li Haidong, a professor at the China Foreign Affairs University's Institute of International Relations, said. The telecoms equipment provider, along with its rival ZTE Corp, have been a long-term target of Washington, as it is forming part of its tough policy toward China, he said.
Section 889 is based on numerous false, unproven, and untested propositions, Song Liuping, Huawei's chief legal officer, told the press conference.
"Contrary to the statute's premise, Huawei is not owned, controlled, or influenced by the Chinese government. Moreover, Huawei has an excellent security record and program. No contrary evidence has been offered," he added.
Fighting back
Huawei has been changing its communications strategies from low profile to open and active. The company has also been hiring, but not more than usual, to fill positions where people had been assigned overseas, Reuters reported on Thursday. And close to 10 senior Reuters journalists have been approached by Huawei recruiters as public relations directors, with some offered annual pay packages of $200,000.
It also invited only foreign media outlets to Thursday's press conference in Shenzhen while sending out wide-ranging invitations to the foreign press to its headquarters for on-site report.
"Actively communicating with foreign press is one of Huawei's priorities now," a source close to the matter told the Global Times in a recent interview.
More importantly, Huawei has been actively calling for unified global standards on cybersecurity - an issue that should not be politicized but fact-based.
It opened a new cyber security center on Tuesday in Brussels, following the ones in Germany and the UK. Ken Hu, another rotating chairman of the company, also called for a unified understanding of cyber security and unified technical standards to tackle security concerns at the launch event.
Huawei invites third-party certification agencies to test its products and codes at the center, which is also open to government officials, industry representatives and the public.
The more open attitude toward the public and the government also shows that Huawei has nothing to hide and nothing to be afraid of.
Huawei's crisis will play a positive role in helping build up unified standards for cybersecurity across the industry, said Fang Xingdong, founder of Beijing-based technology think tank ChinaLabs. "Politics won't solve differences, but technical mechanisms will," he said, adding that deeper reflection and discussions will help the system.
Political implications
Before Huawei sued the US government, Meng Wanzhou, the company's chief financial officer, also filed a civil lawsuit against the Canadian government for her arrest in Vancouver.
She is also seeking damages for malfeasance in public office and false imprisonment based on alleged multiple failures of Canadian government officials to comply with the rule of law in her detention, search, and interrogation at Vancouver International Airport.
"These two events happened one after another, indicating that it has reached a critical point. Huawei is using the judicial independence claimed by the US and Canada to leverage its strength within their society," Li said.
The US government has long branded Huawei a threat, Guo told the press conference. "It has hacked our servers and stolen our emails and source code. Despite this, the US government has never provided any evidence supporting their accusations that Huawei poses a cyber security threat."
Judging from the past behavior of the US, it is a common practice that it intrudes into various governments and enterprises' cyber system to obtain their so-called national security advantages, said Xiao Xinguang, the chief technical architect of Beijing-based Antiy Labs. "The US itself has this ritual of prioritizing its national security and of turning other problems into a security issue."
The US National Security Agency already infiltrated servers of Huawei Technologies Co in 2014, obtaining sensitive information and monitoring the communications of top executives, according to a report by the New York Times.
The US was able to hack into Chinese colleges and companies through its PRISM program, and Huawei was one of their targets, Shen Yi, the director of the Research Center for Cyberspace Governance of Fudan University, said. "They've also developed tools to monitor and hack other people's network access packets and find loopholes, and once they succeed, everything you do is seen."