The European Union is moving to bar Huawei’s equipment and components deemed “high‑risk” from critical supply chains, targeting 5G networks and other essential services. This draft legislation aims to protect digital sovereignty by phasing out Chinese technology, forcing Huawei to adapt its strategy in Europe while reshaping the continent’s telecom landscape.
Huawei’s Global Footprint
Huawei employs roughly 180,000 people and operates in about 170 countries. The company holds around a 20 % share of the worldwide smartphone market, making it the second‑largest handset seller after Samsung. In its home market, Huawei retained the top position throughout 2025, underscoring its resilience despite years of sanctions.
EU Draft Proposal on High‑Risk Suppliers
The European Commission has released a draft proposal that would require member states to phase out components and equipment classified as “high‑risk” from public procurement and essential‑service supply chains. The measure is part of a broader EU cybersecurity strategy aimed at safeguarding digital sovereignty.
Scope of the Proposal
The draft covers a wide range of hardware and software, from 5G infrastructure to industrial control systems. By targeting any technology that could be exploited by hostile actors, the EU seeks to reduce supply‑chain vulnerabilities across critical sectors.
Huawei’s Response to the EU Plan
Huawei has publicly described the EU initiative as unfair and discriminatory toward Chinese firms. The company warns that the “high‑risk” definition could be applied selectively, potentially sidelining Chinese technology regardless of its technical merits.
5G Rollout and the EU’s Security Push
A related EU cyber‑bill aims to block Huawei from participating in 5G network deployments. The legislation seeks to “root out risky Chinese technology vendors” from telecom supply chains, building on earlier national bans in several European countries.
Potential Implications for the Tech Ecosystem
If adopted, the EU measures could reshape market dynamics for both Chinese and non‑Chinese technology firms.
Impact on Huawei’s Business
Exclusion from European 5G projects would limit a lucrative market segment for Huawei, accelerating its shift toward alternative revenue streams such as its own operating system and enterprise solutions.
Effect on European Telecom Operators
Operators may become more dependent on non‑Chinese vendors, which could increase costs and slow network deployment timelines as they adjust to new supply‑chain requirements.
Balancing Security and Competition
Critics argue that the EU’s approach could stifle competition and innovation by favoring established Western players. Proponents contend that stringent vetting is justified to protect critical infrastructure from sophisticated cyber‑espionage and supply‑chain attacks.
Future Outlook
Huawei’s extensive global presence means that any regulatory shift will reverberate across the industry. The company’s ability to adapt to the EU’s emerging framework will be a key indicator of how Chinese tech firms navigate an increasingly fragmented global market. The draft proposal remains subject to negotiation among EU member states and the European Parliament.
