Brussels is demanding proof from the Spanish government that it has implemented an effective system to restrict Huawei's access to the 5G network. The European Commission already gave Spain permission in mid-March a two-month postponement for the evaluation of the fourth payment of European funds, endowed with 10,000 million euros and with milestones that should have been completed by the end of 2022. The election disruptions and the management of such an ambitious plan have delayed the Spanish government for more than a year. The postponement is justified because the unemployment benefits reform has not yet been adopted and because of technical changes that would make it easier to verify compliance with the targets. However, there is more: according to well-informed sources, Brussels is putting pressure on the executive to provide sufficient guarantees that restrictions will be applied to high-risk suppliers in the use of 5G. In practice, It would mean that the veto against the Chinese multinational Huawei would be tightened so as not to leave strategic autonomy in its hands. European. This is one of the milestones to be completed for the fourth cash payment and is currently under review.

The government considers the commitment to be fulfilled: “It has been fulfilled with the approval on April 30 of the 5G security program. The steps are agreed and there is no debate,” the Ministry of Digital Transformation said. This Royal Decree provides the possibility to designate risk suppliers and obliges operators to carry out risk analyzes and diversify the technology offering. But Brussels has yet to decide whether sufficient guarantees are provided. On the one hand, the Commission does not, under any circumstances, want Community funds to be used to finance the development of 5G with Huawei technology. This happened with the rollout of the rural network, paid for with European funds. To ensure Huawei did not intrude, the government and the Commission agreed that operators would bear the costs of replacing the supplier if it was classified as a risk. Faced with this threat, operators would avoid hiring Huawei. However, the Minister of Digital Transformation, José Luis Escrivá, has publicly stated that he does not intend to draw up a list of at-risk suppliers. And these statements are not well received in Brussels, because if no list is published and there is no possibility to identify the risk suppliers, then the threat would actually decrease.

The other reason for discussion lies in the safety of 5G. The approved scheme allows identification and designation of critical areas of the network. According to industry sources, Huawei is barely in the core of the backbone network of the main Spanish operators: Telefónica, Masorange and Vodafone. Not even in management services. But it is mainly in the antennas. The Commission is keen to consider how the restrictions on Huawei will be applied in these sensitive areas.

The government claims that with the security scheme it has already set up a format to declare Huawei a risk supplier. And the simple threat is already preventing operators from signing a contract with the Chinese multinational. Escrivá must convince the Commission that his plan will be effective.

The vetoes against Huawei began with Donald Trump's administration in the United States, when it listed the Chinese multinational as a national security threat in May 2019, arguing that it was serving the Communist Party and that it could use his equipment for espionage. This forced Google to revoke Huawei's permissions so that its phones could use the Android operating system and with it applications such as Gmail or Maps. And he had Meta take away WhatsApp. Companies like Intel or Qualcomm stopped selling chips. And the Chinese business conglomerate was denied access to 5G networks. Countries such as Canada or Japan have also imposed this type of veto. And the Biden administration has continued this policy.

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In Europe, the Commission initially gave states a free hand to do as they saw fit. But after the war in Ukraine, Brussels learned the lesson about strategic autonomy: it did not seem reasonable that there would be more exposure in Europe to Chinese 5G than to Russian gas, especially when it becomes of great importance and can be pirated. for having an open architecture. The European Commissioner for the Internal Market, Thierry Breton already called on the member states last year to act quickly and effectively: In a June statement, it said Huawei and ZTE “represent significantly greater risks.”

But according to industry sources, Spain has put itself on the map and has not been as forceful as the Commission recommends: although it has enshrined in legislation the possibility of identifying 5G suppliers as risky, it has done so without the concreteness that Brussels would want. For example, the royal decree approved on the 5G security program states that the government “may classify certain 5G suppliers as high risk.” But in no case is this an obligation, which in fact leaves open the possibility that this will never happen. This is what Article 15 looks like. According to experts consulted, the text leaves the responsibility on the operators and is ambiguous enough that the executive can throw up its hands and do nothing.

The government and several consulted experts argue that the fact that this mechanism has been created already ensures that operators do not hire Huawei. However, the Commission is pushing ahead and taking advantage of the fact that this is a defined milestone for the fourth payment of European funds. This states that Spanish law must comply with the European toolbox in the field of 5G security. And it specifies: “Imposing on telecommunications operators obligations relating to risk assessment and management relating to security; imposing obligations regarding supply chain diversification to avoid technological dependence; means to identify high and medium risk sellers and possible limitations on their use. This last point is where Brussels now wants to focus the discussions.

The Commission will have to assess whether the government strictly complies with these requirements. Two years ago, then Secretary of State for Telecommunications Roberto Sánchez said he would not publish the list of risk providers. And the industry's current minister, José Luis Escrivá, has stated that he will not or will not publish the list. The government defends that it has regulated sufficiently and that it is doing the same as other countries. In reality, however, almost everyone adheres to the Commission's guidelines. The Scandinavians, the Baltic states, France or Italy are already erecting operational barriers for Huawei. For example, despite Chinese pressure, Portugal approved a list of at-risk suppliers that it did not make public but provided to operators. However, the Spanish government can rely on Germany to tackle the problem in a similar way to Spain. Berlin has never wanted to antagonize the Chinese, whom it considers essential trading partners.

Chinese capital is now gaining importance in Spain, at a time when the government needs private investors for the country's reindustrialization and for its strategic projects financed by European funds. These are the cases of Envisión with the battery factory in Extremadura, the Nissan factory where Chery entered or that of Airbus which Zhenshi bought to produce wind blades.

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