FILE PHOTO: People walk past a sign board of Huawei at CES (Consumer Electronics Show) Asia 2018 in Shanghai, China June 14, 2018. REUTERS/Aly Song/File Photo
TOKYO (Reuters) – Japan’s big three telecoms operators plan not to use network equipment from China’s Huawei Technologies Co Ltd [HWT.UL] and ZTE Corp (0763.HK) (000063.SZ), Kyodo News reported on Monday.
The plan applies to current equipment as well as upcoming fifth-generation (5G) gear, Kyodo reported without citing sources.
Japan plans to ban government purchases of equipment from Huawei and ZTE to ensure strength in its defenses against intelligence leaks and cyber attacks, sources told Reuters last week.
Huawei has already been locked out of the U.S. market and Australia and New Zealand have blocked it from building 5G networks amid concerns of possible links the firm has with China’s government. Huawei has repeatedly insisted Beijing has no influence over it.
Markets have been reeling after the news last week that Canadian officials had arrested Huawei’s chief financial officer for extradition to the United States, sparking fears the arrest would throw up another hurdle to the resolution of a trade war between the world’s biggest two economies.
SoftBank, which has a long relationship with Huawei and has partnered the firm in 5G trials, was the biggest decliner among the three telcos on Monday. Its shares closed down 3.5 percent ahead of the Kyodo report, over concerns about the impact a backlash against Huawei could have on its business.
The benchmark index .N225 closed down 2 percent.
Reporting by Sam Nussey and Makiko Yamazaki; Editing by Muralikumar Anantharaman and Christopher Cushing