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US lawmakers concerned by Huawei deal

by Staff Writers
Washington (AFP) Feb 10, 2011
US lawmakers expressed concern on Thursday over the sale of US computer firm 3Leaf Systems to Chinese technology giant Huawei, saying the deal could pose a "serious risk" to US national security.

In a letter to Commerce Secretary Gary Locke and Treasury Secretary Timothy Geithner, Democratic Senator Jim Webb of Virginia, Republican Senator Jon Kyl of Arizona and three other lawmakers accused Huawei of having "ties with the People's Liberation Army, the Taliban, and the Iranian Revolutionary Guard."

They asked to be updated on the status of the review of the 3Leaf acquisition by the Committee on Foreign Investment in the United States (CFIUS), which reportedly began looking into the transaction in December.

Citing press reports, they said Huawei had purchased 3Leaf's intellectual property and hired a number of its employees in May 2010.

3Leaf Systems, founded in 2004, offers software that allows computer resources to be reallocated according to a user's needs across a computer network.

"Allowing Huawei and, by extension, communist China to have access to this core technology could pose a serious risk as US computer networks come to further rely on and integrate this technology," the lawmakers said.

"Huawei has well-established ties with the People's Liberation Army; it has also reportedly received extensive government support from the People's Republic of China," they said.

"Likewise, Huawei has supplied equipment to Saddam Hussein and the Taliban, and now appears to be working extensively in Iran's telecom sector, of which the Iranian Revolutionary Guard Corps owns a significant stake," they said.

"We are convinced that any attempt Huawei makes to expand its presence in the US or acquire US companies warrants thorough scrutiny," the lawmakers said.

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