The European Union should be worried about Huawei and other Chinese technology companies because of the risk they pose to the bloc's industry and security, the EU's technology commissioner said today.

"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 told a news conference in Brussels, days after a top executive at Chinese tech giant Huawei was arrested in Canada as part of an investigation into alleged bank fraud.

Huawei, which generated US$93 billion in revenue last year and is seen as a national champion in China, faces intense scrutiny from many Western nations over its ties to the Chinese government, driven by concerns it could be used by Beijing for spying.

Ansip said he was concerned because Chinese technology companies were required to cooperate with Chinese intelligence services, such as on "mandatory back doors" to allow access to encrypted data.

He also said those companies produce chips that could be used "to get our secrets".

"As normal, ordinary people we have to be afraid," he said, adding he did not have enough information about the recent arrest in Canada.

Germany said today it opposed excluding any manufacturers from the planned construction of 5G mobile networks.

Belgium's centre for cybersecurity was considering the possibility of banning Huawei in the country, newspapers L'Echo and De Tijd reported.

The company supplies equipment to telecom providers Proximus and Orange Belgium. The centre was not immediately reachable for comment.

The EU as a whole is braced to launch a far-reaching system to coordinate scrutiny of foreign investments into Europe following a surge of Chinese investments and concerns about security and forced technology transfer.

However, the arrest in Canada of Huawei chief financial officer Meng Wanzhou (photo) relates to a US investigation into an alleged scheme to use the global banking system to evade US sanctions against Iran, people familiar with the probe told Reuters.

Europeans too could potentially face prosecution in the United States, which has withdrawn from an agreement with Iran on its nuclear programme. Reimposed U.S. sanctions have already forced many European companies to stop trading with Iran.

Meng was due to appear in a court on Friday as she awaits a possible extradition to the United States.

Meanwhile, Huawei has promised to address security issues raised in a British government report earlier this year, two sources with knowledge of the matter said today.

The report, signed off by Britain's GCHQ spy agency and released in July, found that technical and supply-chain issues with equipment made by Huawei had exposed Britain's telecom networks to new security risks.

One source said the company had committed to spending US$2 billion as part of efforts to address the issues.

The second source said the plan had been discussed by senior Huawei officials in China, but the decision was made before the company's CFO was arrested in Canada on Dec 1.

Huawei did not immediately respond to a request for comment.

– Reuters