China’s two telecoms giants Huawei and ZTE (HKG:0763; SHE:000063) are facing the prospect of European Union authorities launching an investigation into alleged dumping of telecoms equipment on European markets. It could lead to steep tariffs on ZTE and Huawei hardware in this sector (though not, presumably, on their smartphone sales).
A couple of months ago, the US House completed a probe of ZTE and Huawei and judged them to be security threats that US companies should avoid working with – a charge both companies strenuously deny.
The WSJ (paywalled) notes today:
The investigation could lead to steep tariffs on wireless-network equipment made by the two Chinese firms, which have made deep inroads into the 27-nation EU market over the past five years. An analysis prepared by the European Commission, the EU’s executive arm, and seen by The Wall Street Journal says the two firms are clearly dumping their products onto the European market at unfairly low prices, using aid from the Chinese government that violates international trade rules.
(Source: Wall Street Journal)