Tag - Huawei corruption scandal

Notes on a scandal — will a fraud probe upend the EU?
Listen on * Spotify * Apple Music * Amazon Music Brussels was jolted this week by dawn raids and an alleged fraud probe involving current and former senior EU diplomats. Host Sarah Wheaton speaks with Zoya Sheftalovich — a longtime Brussels Playbook editor who has just returned from Australia to begin her new role as POLITICO’s chief EU correspondent — and with Max Griera, our European Parliament reporter, to unpack what we know so far, what’s at stake for Ursula von der Leyen, and where the investigation may head next. Then, with Zoya staying in the studio, we’re joined by Senior Climate Correspondent Karl Mathiesen, Trade and Competition Editor Doug Busvine and Defense Editor Jan Cienski to take stock of the Commission’s first year — marked by this very bumpy week. We look at competitiveness, climate, defense and the fast-shifting global landscape — and our panel delivers its score for von der Leyen’s team.
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Qatargate: European Parliament shields MEP from prosecution
The European Parliament’s legal affairs committee on Wednesday voted against lifting the immunity of an Italian Socialist lawmaker accused of being involved in the Qatargate scandal, on the grounds that Belgian prosecutors did not provide enough evidence. The committee did vote to lift the immunity of a second Italian Socialist MEP, according to three officials, granted anonymity to discuss the sensitive negotiations, as were others quoted in this piece. Both decisions need to be ratified by the entire Parliament at a plenary session on Dec. 15. The Socialists and Democrats group has maintained that the alleged wrongdoing claimed by Belgian prosecutors did not match the level of evidence provided in the immunity waiver request. The European People’s Party and Renew agreed with the S&D in the case of Elisabetta Gualmini, but decided the accusations against Alessandra Moretti were strong enough to lift her immunity.  The S&D group on Tuesday night lobbied other groups to protect both lawmakers, according to two officials, and called a secret vote to allow individual lawmakers to break party lines and shield Moretti. However, that push was in vain. Gualmini allegedly received help from other Qatargate suspects to get the job of S&D group vice chair and use her influence to manipulate discussions and decisions on Qatar within the group, while Moretti is being investigated for allegedly receiving benefits in exchange for speaking favorably about Qatar, according to an internal note from the legal affairs committee seen by POLITICO. Both MEPs deny wrongdoing. The S&D can still try to overturn the decision in plenary if they can convince enough MEPs to break ranks and shield Moretti. Gualmini and Moretti did not reply to requests for comment. A spokesperson for the S&D did not reply to a request for comment. PARLIAMENT VS. BELGIUM The Parliament has increasingly been wary of Belgian prosecutors, with MEPs arguing that police often do not provide enough evidence to justify their investigations.  Belgian authorities can be “a bit exaggerated,” argued an EPP MEP. “The relationship between Belgian prosecutors and the Parliament is in such a bad state,” argued a second centrist MEP. “Belgian authorities come too early with little evidence, while other prosecutors come later on in the process with tighter cases built.”  Although the Parliament is not concerned in this week’s fraud probe involving the EU’s foreign service, the scars from Qatargate and the Huawei cash-for-influence affair are still fresh. On Qatar, many MEPs are sore that, after three years of investigation, there is still no judgment. They’re afraid that the whole case could fall through at a hearing in December after the defendants challenged the legality of the proceedings.   On Huawei, resentment in Parliament flared up in May when Belgian prosecutors made headlines for asking that an MEP’s legal immunity be lifted over alleged bribery, only to withdraw the request hours later as the politician wasn’t in office at the time of the alleged wrongdoing. Lawmakers blasted the move as “sloppy.”  The authorities’ actions even prompted Parliament President Roberta Metsola to publicly call out Belgium — and other countries — for “tarnishing” MEPs’ reputations without “a solid basis.” In June, Metsola said Parliament would require a much higher standard of evidence for requests to lift immunity.  “A letter was sent to all permanent representations in September to remind them about the information that would need to accompany a request for immunity,” Metsola’s spokesperson, Jüri Laas, told POLITICO.  The constitutional affairs committee has started the process of reviewing the rules on lifting MEPs’ immunity to ensure a certain level of information is sent by prosecutors before the request can be made public in plenary, committee chair Sven Simon said Wednesday.
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Corruption
Fraud
Qatargate: European Parliament corruption scandal
Huawei corruption scandal
EU solar power lobby buckled under legal pressure from Huawei
BRUSSELS — Huawei was rushed back into the EU’s most influential solar panel lobby after threatening legal action in reaction to its earlier expulsion over its alleged involvement in a bribery and corruption scandal.   That’s outraging other solar power companies, worried that creating a special membership category for Huawei could undermine the ability of SolarPower Europe to effectively represent the industry in Brussels.  “The conduct reported … specifically the handling of Huawei’s membership has seriously undermined both my personal confidence and that of our organization in the governance of SPE,” Elisabeth Engelbrechtsmüller-Strauß, CEO of Austrian company Fronius, wrote in a letter to SPE, which was obtained by POLITICO.  Lawyers for Huawei and SolarPower Europe met at the end of May for negotiations, an industry insider told POLITICO, which culminated in SPE sending a final agreement to the Chinese company at the beginning of September.   Huawei argued that the European Commission’s decision to ban its lobbyists from any meetings with the executive or the European Parliament was unlawful and did not warrant a full expulsion from SPE, said the insider, who spoke on condition of being granted anonymity over fears of retaliation for speaking out.  The ban on Huawei lobbyists was put in place in March after Belgian authorities accused the company of conducting a cash-for-influence scheme and bribing MEPs to ensure their support of Huawei’s interests.  At the time, Huawei maintained it has a “zero-tolerance stance against corruption.”  During the Sept. 29 meeting to reinstate Huawei’s membership, SPE told its board of directors that the organization wanted to avoid a lawsuit and a potentially costly trial.  Instead, SPE proposed making Huawei a passive member that would not actively participate in the group’s workstreams — an option the board accepted, POLITICO reported earlier this month.   Huawei did not respond to a request for comment about its legal threat.  SPE acknowledged the threat in a letter to Fronius, one of its board members, on Thursday. “Based on legal advice and with the assistance of external lawyers, SolarPower Europe held discussions with Huawei with a view to avoiding litigation and protracted legal uncertainty regarding Huawei’s membership status, while preserving SolarPower Europe’s uninterrupted and unrestricted access to the EU Institutions and other relevant stakeholders,” reads the letter obtained by POLITICO.  The SPE’s letter was a response to an Oct. 20 letter from the Austrian solar panel manufacturer sent to the lobby after POLITICO’s story was published on Oct. 9. Fronius called for full transparency over the reinstatement of Huawei and action against any appearance of corruption.  The Austrian company’s concern is that SPE will be “unable to effectively represent” the sector given the EU’s ban on direct contact with Huawei or groups that lobby on its behalf, Engelbrechtsmüller-Strauß told POLITICO in an email.   Fronius is also raising questions about whether SPE can designate a company as a passive member — a status that does not exist in the organization’s bylaws.  “To our knowledge, SPE’s status do not include such a membership category,” Fronius’s letter to SPE reads. “We request a clear explanation of what this form of membership is based on.”  SPE did not raise the issue of member status in its response to Fronius.   The lobbying practices of Huawei and other Chinese companies are under a microscope over concerns around the influence they wield over crucial technologies, including renewable energy and 5G mobile data networks.  While it is better known as a telecom giant, Huawei is also a leader in manufacturing inverters, which turn solar panels’ electricity into current that flows into the energy grid.  Cybersecurity experts warn inverters offer a back door for bad actors to hack into the grid and tamper with or shut it down through remote access.  Two members of the European Parliament sent a letter to the European Commission earlier this month warning of such risks and urging the executive to restrict high-risk vendors like Huawei from investing in Europe’s critical infrastructure.  “Inverters are the brain of a [solar panel] system, connected to the internet and must be remotely controllable for updates. This applies regardless of who the manufacturer is,” Engelbrechtsmüller-Strauß said. “If European legislation does not address the ‘manufacturer risk,’ then energy security in Europe will be jeopardized, which I consider critical.” 
Technology
Cybersecurity and Data Protection
Energy and Climate
EU-China relations
Lobbying
European Parliament tightens rules on access for journalists and lobbyists
The European Parliament will limit the access of journalists, lobbyists and diplomats to its premises starting next week. A colored badge, issued to outsiders, will no longer allow them to freely roam buildings in Brussels and Strasbourg. The new system is based on the Parliament’s calendar, where each week is marked with a color: red for plenary sessions, blue for political group meetings, pink for committee meetings, and white for quiet weeks during summer recess or Christmas break, Euronews reported. For example, during white weeks, those interested in visiting the Parliament buildings will only be allowed in if they have an invitation signed by an MEP. In Brussels such invitations will also be needed if an outsider wants to visit a building other than the main Altiero Spinelli and József Antall blocks, regardless of what week it is. In Strasbourg invitations will be required to access premises outside plenary sessions or to enter the area where lawmakers’ offices are located. “The changes introduced to the rules … are part of a broader reform aligning with Parliament’s commitment to ensure transparency, accountability, and public trust,” the institution told Euronews. The rules will take effect Sept. 1. Several lobbyists have complained the rules will be counterproductive, and that they will tend to target small NGOs rather than large corporations. “Who loses the most? Grassroots organizations, NGOs and independent experts, the very voices that already face structural disadvantages compared to well-funded corporate lobbies,” said Isabella Sofia De Gregorio, executive director of EDUXO Italia, a non-profit educational association, in a post on LinkedIn. The founder of consultancy UNGovern, Jakub Zientala, called the move “another bureaucratic hurdle in Brussels.” “One more barrier for transparent dialogue between policymakers and stakeholders. Instead of encouraging openness, the Parliament adds layers of bureaucracy that mainly hurt smaller organizations, NGOs, and independent experts — the very voices that struggle most to be heard,” Zientala said. The rules are the latest response to scandals like Qatargate and Huaweigate, which have rocked the European Parliament in recent years and have called its transparency and the influence of lobbyists on MEPs into question. In May the Parliament made it mandatory for lobbyists to activate their badges on every visit and to state the purpose of that visit. The European Parliament did not immediately respond to POLITICO’s request for comment.
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2 more Italian MEPs could lose immunity in Huawei corruption probe
BRUSSELS ― Belgian authorities have requested the European Parliament lift the immunity of center-right Italian MEPs Fulvio Martusciello and Giusi Princi in relation to an investigation into a cash-for influence scandal connected to Chinese firm Huawei, according to three EU officials. The requests follow those for Maltese Socialist Daniel Attard, Bulgarian liberal Nikola Minchev, and the European People’s Party’s Salvatore De Meo, all of whom went public earlier this week to defend their innocence and vowed to collaborate with the Belgian authorities.  Parliament President Roberta Metsola is expected to officially announce the five names at the opening of a plenary session on Wednesday afternoon.  Belgian authorities are looking into a scheme apparently used by Huawei lobbyists to advance the company’s position in EU policymaking. They are investigating whether there was remuneration for taking political positions, excessive gifts, paid trips, and invitations to events. Any misconduct would have taken place from 2021 until the end of 2024. Martusciello’s name came up in earlier reports because his assistant was arrested in Italy as part of the ongoing probe. A request to lift a lawmaker’s immunity does not necessarily mean there is wrongdoing, but it is necessary for the police to be able to summon them for official questionings and to investigate them. Martusciello and Princi did not respond to a request for comment. 
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Parliament
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Huawei corruption scandal
European Commission blacklists lobby groups tied to Huawei
The European Commission will no longer meet with organizations affiliated with Huawei, following an investigation into alleged corruption at the European Parliament that would have benefited the Chinese technology firm. “The Commission shall not meet with any lobby groups and/or trade associations that represent Huawei’s interests and/or speak on its behalf,” the Commission’s spokesperson service told POLITICO in a statement. The Commission had already banned “contact and meetings” with Huawei officials in March, just days after Belgian investigators launched a corruption probe into the Chinese technology company’s activities in Brussels. Wednesday’s statement added the ban extended to “any intermediaries acting on Huawei’s behalf who would engage in meetings and other contacts with Commission staff to advance the interests of the company.” At least eight people have been charged by the Belgian prosecutor — including one of Huawei’s most senior executives in Europe — with active corruption, money laundering and criminal organization, after a series of police raids of premises in Belgium, France and Portugal. Huawei is listed as a member of 22 associations in the European Union’s transparency register, which tracks corporate lobbying activities. Several of these, like DigitalEurope, BusinessEurope and the European Internet Forum, have already moved to suspend the Chinese company in response to the bribery scandal. Several other organizations told POLITICO at the end of March that they were “closely monitoring the situation.” Some took measures to distance themselves in the past weeks. At least eight people have been charged by the Belgian prosecutor with active corruption, money laundering and criminal organization, after a series of police raids of premises in Belgium, France and Portugal. | Frederick Florin/AFP via Getty Images At SolarPower Europe, Huawei representatives still hold key roles but the organization has scaled back the company’s “non-membership financial commitments,” a spokesperson for the association previously confirmed. SolarPower Europe did not immediately respond to POLITICO’s request for an update on its work with Huawei. Think tank CERRE, which has Huawei as a member, previously said it had the situation “under close review.” It declined to comment for this article. The European Cyber Security Organisation (ECSO), where Huawei is still listed as a member, is reviewing the company’s status with results expected on April 29, it said in a comment. Other organizations that list Huawei as a member, including Eurelectric, the European Association for Storage of Energy, Bruegel, FTTH and ECTA, did not immediately respond to a request for comment or an update on previous statements about their work with the Chinese tech firm. Huawei did not immediately respond to a request for comment. It said in a previous statement: “The company maintains a zero-tolerance stance against corruption. As always, we are fully committed to complying with all applicable laws and regulations.” This article has been updated to include a response from ECSO.
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Cybersecurity and Data Protection
Energy and Climate
Certification and standards
Huawei top executive in Europe charged in Belgian corruption probe
BRUSSELS — One of Huawei’s most senior executives in Europe is a suspect in the Belgian investigation into alleged corruption at the European Parliament benefitting the Chinese technology company, POLITICO can reveal.  The senior executive was represented in a Belgian court on Tuesday, documents relating to the hearing showed. He is charged with “active corruption of a person holding a public office, criminal organization and money laundering,” said one of the documents, which were disclosed as part of the preparation of a hearing at Brussels’ Chamber of Accusation.  The senior executive is listed as a vice president for the Europe region at Huawei and previously held a position as chief representative to the European Union leading the firm’s public affairs office in Brussels. He can only be identified as Yong J. Tuesday’s hearing, held behind closed doors, was part of proceedings where defense teams engage with senior judges to discuss procedural matters, including potential custody decisions.  The senior executive could not be reached for comment and his lawyers did not immediately respond to a request for comment. A Huawei spokesperson also did not immediately respond to a request for comment.  The charges followed a series of police raids of premises in Belgium and Portugal, including Huawei’s Brussels lobbying headquarters and several European Parliament offices. | Frederick Florin/AFP via Getty Images Belgian investigators are probing whether illegal payments were made to secure political backing for an open letter supporting the Chinese company’s interests and signed off by eight members of the European Parliament, according to an arrest warrant seen by POLITICO.  The Belgian prosecutor said Friday it had charged eight people. The charges followed a series of police raids of premises in Belgium and Portugal, including Huawei’s Brussels lobbying headquarters and several European Parliament offices. Aside from Yong J., three other Huawei employees were among the suspects in the corruption probe who first faced Belgian judges last week as part of procedural hearings, including a lobbyist and a senior executive for the firm, who can only be described as Valerio O. and Han W. They are also facing charges related to corruption, money laundering and participation in a criminal organization.  All suspects are presumed innocent.  Huawei fired two employees and suspended a third for their alleged involvement in the bribery investigation, a spokesperson said Monday. The spokesperson did not disclose the identities or roles of the employees affected. It is unclear whether the employees fired and suspended by Huawei are the same as the Huawei officials who were preliminarily charged. Huawei said in a previous statement: “The company maintains a zero-tolerance stance against corruption. As always, we are fully committed to complying with all applicable laws and regulations.”  Mathieu Pollet contributed reporting.
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Technology
Data protection
Transparency
Cybersecurity and Data Protection
Huawei fires two staffers in response to corruption scandal
BRUSSELS — Huawei has fired two employees and suspended a third for their alleged involvement in a bribery investigation surrounding the Chinese technology giant and the European Parliament, POLITICO has learned. The firm “terminated the employment of two individuals” from April 1 and suspended a third from April 2, a spokesperson for Huawei said in a statement. “We take the ongoing investigation seriously,” the spokesperson added. The spokesperson did not disclose the identities or roles of the employees affected by the measures. A lobbyist, a senior executive and a procurement manager with Huawei were among the suspects in the corruption probe who first faced Belgian judges last week as part of procedural hearings. The officials were preliminary charged with corruption, participation in a criminal organization and money laundering. They are presumed innocent. It is unclear if the three employees fired and suspended by Huawei are the same as the Huawei officials who were preliminary charged. “The company maintains a zero-tolerance stance against corruption. As always, we are fully committed to complying with all applicable laws and regulations,” the Huawei spokesperson said. The Belgian prosecutor said Friday it charged eight people in total, three weeks after police raided addresses in Belgium and Portugal, including Huawei’s Brussels lobbying office. Investigators are probing whether illegal payments were made to secure political backing for an open letter supporting the Chinese company’s interest and signed off by eight members of the European Parliament. Out of the eight suspects, three are now under electronic surveillance, two were released “under conditions,” and three remain in prison, according to the statement from the prosecutor.
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Huawei corruption probe: 8 charged
BRUSSELS ― The Belgian prosecutor has charged eight people with active corruption, money laundering and criminal organization in an investigation into Huawei’s lobbying activities in Europe, it said in a statement on Friday. The decision comes three weeks after police raids in Belgium and Portugal, as part of a probe into suspected illegal payments by the Chinese technology giant to secure support from European lawmakers in the company’s interests. Police authorities also searched European Parliament offices in Strasbourg. Out of the eight suspects in the case, three were initially held in pre-trial detention and are now under electronic surveillance following appeals, according to the statement from the prosecutor. Two others were released “under conditions,” it said. The remaining three are still in prison — two are appealing, while the third may still do so. Huawei said in an earlier statement that it “takes these allegations seriously” and “has a zero tolerance policy towards corruption or other wrongdoing.” Elisa Braun contributed to this report.
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Huawei, Forum Europe staff face Belgian court hearings over corruption charges
BRUSSELS — Three Huawei employees and a managing director from Brussels conference organizer Forum Europe appeared in court this week for hearings related to the corruption investigation into the Chinese tech giant’s lobbying in Europe. Police raided more than 20 locations in Belgium and Portugal last month within an investigation into alleged illegal payments made by Huawei to secure an open letter signed by eight European lawmakers in support of the company’s interests, according to the Belgian prosecutor and an arrest warrant seen by POLITICO. Five people were charged as part of the investigation, prosecutors said on March 18. In the first session, the parties met for a 15 minutes behind closed doors at Brussels’ Chamber of Accusation, an appeals court where defense teams discuss ongoing investigations with senior Belgian judges regarding procedural decisions such as whether individuals should be released from custody. A second session, on Wednesday, lasted for more than two hours. According to a court timetable available on site at the Brussels Palace of Justice, the suspects include a lobbyist from Huawei as well as a senior executive and a procurement manager of the Chinese tech firm. The higher profile Huawei employees can be named as Han W. and Valerio O. All are suspected of corruption, participation in a criminal organization and money laundering. They are presumed innocent. Two other defendants are contractors, including one from Forum Europe who is charged with “active corruption of a person holding a public office in an organization governed by public international law,” according to the timetable. Forum Europe said in an email: “We do not have any comment at this time.” The arrest warrant, which POLITICO reported on last week, included details from Belgian prosecutors alleging the key suspects may have facilitated the payments for the pro-Huawei letter. “A sum of €15,000 was offered to the writer of the 5G letter, while each co-signatory was offered €1,500,” read the warrant, signed by the investigative judge. “This transaction or proposed transaction is said to have been endorsed by HUAWEI’s Chinese executives, in particular by …. [the] director of the Brussels office,” it also said. The warrant also described how the former adviser allegedly arranged for the payments via invoices that investigators suspect might be for “alleged consultancy services and campaign expenses, in the amounts of  €18,450 and €27,500.” Huawei said in an earlier statement that it “takes these allegations seriously” and “has a zero tolerance policy towards corruption or other wrongdoing.” The Chinese Embassy in Belgium told POLITICO in a statement that “the Chinese side is in communication with relevant authorities of the Belgian government” and that the “Chinese government always requires Chinese companies [to] strictly observe laws and regulations of the host countries.” Two other people — one former and one current parliamentary assistant to conservative Italian lawmaker Fulvio Martusciello — were arrested in France and Italy as part of the probe, bringing the total number of suspects to at least seven. They both denied any involvement and accepted being extradited.
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