In September 2018, Huawei Pakistan filed for arbitration in District Courts (West), Islamabad against Business Efficiency Solutions (BES) over ongoing contract disputes. This arbitration resulted in an interim relief order in Huawei’s favor. The arbitration process is still ongoing.
We do not comment on ongoing legal cases. Huawei respects the intellectual property of others, and there is no evidence Huawei ever implanted any backdoor in our products.
According to a Wall Street Journal report, a long-running dispute between Huawei Technologies Co. and a small U.S.-based contractor has escalated to U.S. federal court, with the contractor alleging Huawei stole its technology and pressured it to build a “back door” into a sensitive law-enforcement project in Pakistan.
The contractor, Buena Park, Calif.-based Business Efficiency Solutions LLC, or BES, says in a lawsuit filed Wednesday in California district court that Huawei required it to set up a system in China that gives Huawei access to sensitive information about citizens and government officials from a safe-cities surveillance project in Pakistan’s second-largest city of Lahore.
Muhammad Kamran Khan, chief operating officer of the Punjab Safe Cities Authority, which oversees the Lahore project, said the authority has begun looking into BES’s allegations. “Our team is examining the accusations and sought an explanation from Huawei,” Mr. Khan said in an interview. “We have also put a data security check on Huawei after this issue. So far, there has been no evidence of any data-stealing by Huawei.”
In comments to The Wall Street Journal last September, Huawei acknowledged setting up a separate version of the Lahore system in China, but said it was only a test version that was “physically isolated from the customer’s live network.” This made it “impossible for Huawei to extract data from the customer’s live network.”
The allegations in the suit stemmed from a long-running legal dispute between the companies. Huawei hired BES to provide software and other services to help it win the rights to build Lahore’s safe-city project in 2016. It eventually beat out Western competitors including Motorola Solutions and Nokia Corp. with its bid of $150 million, according to the suit, in which BES is represented by lawyers from Akin Gump Strauss Hauer & Feld LLP.
The relationship soured, and Huawei sued BES in Pakistan, where BES also sued Huawei. Those proceedings are ongoing. BES is no longer operational and has no revenue.