A report by British intelligence that was leaked to the press on February 18 suggests that Chinese telecommunications company Huawei could be allowed to develop 5G communication infrastructure under certain conditions as any risk posed by Huawei can be mitigated, the National Cyber Security Centre chiefs determined, according to BBC and the Financial Times.

The report confirms the view expressed by the head of MI6, Alex Younger, who indicates that the UK might take a softer line on Huawei after months of growing acrimony between the telecom giant and the West over Huawei’s connection to China’s spy services and the subsequent arrest of its CFO, Meng Wanzhou, while she was in  Canada in December 2018. Meng’s arrest came at the request of the United States, which accused her of defrauding multiple financial institutions in breach of US-imposed bans on doing direct business with the Islamic Republic of Iran.

Most of the UK’s mobile companies have been working with Huawei on developing their 5G networks. British mobile companies are now in the process of removing Huawei’s equipment from 3G and 4G mobile and will exclude the company from 5G network development following revelations that Huawei is tied to China’s intelligence services.

The leaked report, however, does not commit the British government to a final decision on whether or not to ban Huawei, but it will carry significant weight. Australia, New Zealand, and the US have all banned Huawei from supplying equipment for their future fifth generation mobile broadband networks. Canada is also considering a similar move.

Although Germany has also questioned whether a total ban is necessary, the UK’s position has special significance. The conclusions by British intelligence somewhat contradict the US’ assertions that Huawei undermines Western security by acting as a proxy for China’s Communist Party.

The US National Security Agency has argued that allies who are engaged in intelligence-sharing should refrain from using Huawei’s equipment. The same point was reiterated by US Vice-President Mike Pence during the recently concluded Munich Security Conference.

American officials admit that although there may be no evidence of nefarious activity so far, Huawei could use malign software updates to facilitate espionage activities in the future.

The UK’s intelligence agencies are now expected to recommend a list of suppliers as well as their partial restrictions for 5G network development.