Huawei, ZTE refute patent charges

Chinese telecom companies expressed their concerns Friday about accusations of patent infringement made by US companies and said they are ready to defend themselves against the charges.

The US International Trade Commission (USITC) announced Thursday it would launch a Section 337 investigation into wireless devices and components produced by four communications companies in South Korea, Finland and China for patent infringement.

Besides South Korean company Samsung and the Finnish telecommunications giant Nokia, Chinese companies Huawei, the world's second-largest telecommunications equipment maker, and ZTE, the fifth-largest, are listed for investigation.

In a statement sent to the Global Times Friday, ZTE said the company is concerned about the investigation and will actively defend itself in a fair and reasonable manner.

The investigation was launched after a petition by Pennsylvania-based InterDigital Communications Corp and three other US companies on January 2, which accused Huawei, ZTE and the other two companies of selling products that infringe upon their patents, the USITC said in a statement Thursday.

The USITC did not specify which products from Huawei and ZTE are under investigation but said the products from the four companies subject to the probe consist of cellphones, including smartphones, PC cards, USB dongles or sticks, personal computers such as laptops, notebooks, netbooks, tablets and other mobile Internet devices with cellular capabilities.

The petitioners requested the USITC issue an exclusion order as well as cease and desist orders.

"China is facing increasing trade protectionism on all fronts ranging from low-end products to high-tech products. Huawei and ZTE have been targeted particularly because their international competitiveness has improved quickly over the past few years," Tu Xinquan, associate director of the China Institute of WTO Studies, told the Global Times.

"The Section 337 investigation is the fastest way to allow US companies to punish their competitors," Tu said.

The Section 337 investigation was instituted as part of the US Tariff Act of 1930 and most of the investigations involve patents or registered trademark infringement allegations. Once the process is launched against a company, the company could be barred from exporting its products to the US during the entire legal process and could only resume sales after being found not guilty in court.

The US launched a total of 18 Section 337 probes against products by Chinese companies in 2012, according to data provided to the Global Times by the Bureau of Fair Trade for Imports and Exports under the Ministry of Commerce Friday.

This is not the first time Huawei and ZTE have been targeted. In October, the two companies faced charges by a congressional panel in the US that they pose a security threat to the US and should be barred from mergers and acquisitions in the US. Both companies denied the charges.

The European Commission is also investigating allegations that Huawei and ZTE receive government subsidies which allow them to sell products at low prices in Europe.

The USITC is required to target date for completing the investigation within 45 days of the investigation being launched.