By Nikos Chrysoloras and Richard Bravo

February 7, 2019, 4:49 PM EST

Any Western country allowing Huawei Technologies Co. or other Chinese equipment to be used in critical infrastructure projects will face the risk of U.S. countermeasures, the U.S. envoy to the European Union said.

The warning adds to signs that U.S. President Donald Trump’s administration is pushing for a blanket ban on Chinese companies from new 5G wireless networks, autonomous vehicles and other lucrative contracts in the technology sector throughout Europe, North America and other American allies. It comes as the EU weighs the introduction of a new sanctions regime against companies or countries involved in cyber-espionage and intellectual property theft.

“There are no compelling reasons that I can see to do business with the Chinese, so long as they have the structure in place to reach in and manipulate or spy on their customers,” Ambassador Gordon Sondland, Trump’s envoy in Brussels, said Thursday in an interview. “Those who are charging ahead blindly and embracing the Chinese technology without regard to these concerns may find themselves in a disadvantage in dealing with us.”

Depending on the Chinese equipment used by Western countries, the U.S. may have to be “more careful in sharing information, in transacting business,” and a “host of things,” Sondland said. He urged European countries to pick Finnish and other Scandinavian companies for their 5G contracts, citing a Chinese law that allegedly compels any private company in the country to cooperate with the government “on any intelligence matters in secret and without refusal.”

Senior European officials have echoed Sondland’s concerns. In an interview last month, Andrus Ansip, European Commission vice president for digital affairs, said China’s National Intelligence Law, passed in 2017, has increased the risk in dealing with Chinese companies in Europe. The law mandates any organization and citizen to support and assist national intelligence in their investigations and to keep information related to such investigations.

While Ansip stopped short of urging restrictions for Chinese companies, he urged “all the governments, all the responsible people, to deal with the risk assessment in a very serious way.” No EU-wide law has been introduced on the matter to date, and any restrictions on 5G contracts for national security reasons remain a decision for individual nations.

https://www.bloomberg.com/news/articles/2019-02-07/huawei-deals-for-tech-will-have-consequences-u-s-warns-eu