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Gillard, who was at a security conference in Seoul, said the planned Australian network is a crucial national project.

“You would expect, as a government, we would make all of the prudent decisions to make sure that that infrastructure project does what we want it to do, and we’ve taken one of those decisions,” she said, when asked about Huawei.

Gillard gave no details of the reason for the decision.

Huawei was founded in 1987 by a former Chinese military engineer but says it has no connection to the military. The company says it is employee-owned but has released few details about who controls it, which has fueled questions abroad.

Huawei had been endorsed as a bidder on the Australian project by the technical department of the government-owned National Broadband Network Co., the Financial Review said. It said the attorney general blocked that after intelligence officials objected.

Huawei, based in the southern Chinese city of Shenzhen, near Hong Kong, reported revenues for the first half of last year of 98.3 billion yuan ($15.8 billion) and says its equipment is used in 140 countries.

In 2010, it was blocked from taking part in upgrading a U.S. phone carrier’s network and last year was forced to unwind its acquisition of an American computer company after a security panel rejected the deal.

The U.S. House of Representatives intelligence committee said in November it would investigate whether allowing Chinese companies to expand in the United States might aid Chinese electronic spying.

It cited Huawei and rival ZTE Corp., another telecom equipment supplier, as being among the companies to be examined.

The panel said it will look into the role Chinese companies play in supplying components for U.S. telecoms systems and whether access to those systems might allow foreign governments to gather information.


McDonald reported from Beijing.



Huawei Technologies Ltd.: