BRUSSELS -- The European Union has opted to let each member nation decide whether to use equipment from China's Huawei Technologies, snubbing American demands to keep the company out of high-speed 5G networks.
"EU member states have the right to exclude companies from their markets for national security reasons, if they don't comply with the country's standards and legal framework," the European Commission said in a nonbinding recommendation issued on Tuesday. But the commission declined to issue a bloc-wide ban, in part due to the varied opinions among the EU's ranks.
The U.S. thinks that Huawei's telecom equipment can be used for espionage, and Washington has threatened to end intelligence sharing with any country using the company in fifth-generation wireless. The EU's move appears likely to become another flashpoint in bilateral ties already under strain over trade and other issues.
Germany does not plan to single out any specific company, and Italy has expressed interest in working with Huawei to build its 5G networks. A leading telecommunications company in Portugal signed a memorandum of understanding with the Chinese provider in December. Yet countries looking to bolster ties with the U.S. have adopted tougher attitudes toward Huawei. Poland arrested a local Huawei employee this year on allegations of spying.
The recommendation Tuesday did stress the need for greater security in 5G networks -- which could connect factories, self-driving cars and more. "Its cybersecurity is crucial for ensuring the strategic autonomy of the Union," said the recommendation.
The European Commission urged member nations to review security risks involved in 5G by the end of June, likely a nod to U.S. concerns. It also advocated more stringent standards for operators of 5G frequencies and aimed to ink a bloc-wide strategy on fifth-generation wireless by the end of the year.
"Do we have to be worried about Huawei or other Chinese companies? Yes, I think we have to be worried about those companies," Andrus Ansip, European Commission vice president for the digital single market, told reporters back in December.
Still, the EU's ties with Washington appear headed for further trouble.
"If our allies and partners go with a Huawei solution, we need to reconsider how we share critical information with them," Ellen Lord, U.S. undersecretary for defense, said on Monday.
Washington is considering additional tariffs on European autos, citing national security concerns. U.S. President Donald Trump also has slammed European NATO members for not shouldering enough of the alliance's costs.
Under the U.S. National Defense Authorization Act, passed in August 2018, government agencies are barred from contracting with Huawei and four other Chinese manufactures, or companies that use their equipment. Huawei has filed a suit against the U.S government, calling the legislation unconstitutional.