Who controls Huawei? Chinese telecoms leader’s ownership structure explained in more detail

A research paper questioning the independence of Huawei Technologies put the world’s biggest telecommunications network gear maker back on the offensive last week, as it held a press conference to rebut the paper’s central assertion that it may ultimately be controlled by the government.

The paper, jointly written by Donald Clarke of George Washington University and Christopher Balding of Fulbright University Vietnam, said that Huawei’s controlling holding company – 99 per cent of which is held by an entity called a “trade union committee” – could mean Huawei is owned and controlled by the government, if the committee functions like similar organisations in China.

Huawei dismissed this claim at a press conference in Shenzhen on Thursday, saying the trade union committee had been established to meet legal requirements and that it only had oversight of after-hours staff activities, such as badminton and hiking.

The latest spat over ownership and control marks another twist in the road as Huawei seeks to fight off US accusations that its gear poses a national security risk and that countries should reconsider including the Chinese giant in their 5G network infrastructure plans. Here’s what you need to know about Huawei’s trade union committee and ownership structure:

1. Why does the research paper take issue with Huawei’s relationship to the trade union committee?

The research paper finds that Huawei Investment & Holding Co, the parent company of Huawei Technologies and its other subsidiaries, is 98.99 per cent owned by Huawei’s trade union committee and 1.01 per cent owned by Huawei’s founder and chief executive Ren Zhengfei.