Huawei state-owned? That’s laughable, says Australian CEO Hudson Liu

Huawei’s Australian CEO says claims the company is owned by the Chinese government are laughable.

Huawei Australia CEO Hudson Liu. Picture: Gary Ramage

Huawei’s Australian chief executive says claims the company is owned by the Chinese government are laughable, despite questions over its opaque ownership and governance structure.

In a speech in Sydney, Hudson Liu declared: “Huawei is not and has never been owned by the Chinese government. We are owned by our employees, with around 100,000 employees owning shares, including myself and many others here in Australia.”

However, two US academics say the “trade union committee” that owns 99 per cent of Huawei is not employee-controlled and, like other Chinese unions, is ­“effectively state-owned”.

Mr Liu’s speech was part of a “getting the facts straight” roadshow by the Chinese telco, which recently dissolved its local board — amid substantial job and revenue losses — after it was deemed a “high-risk vendor” by the government and banned from partici­pating in the nation’s 5G network.

He said Huawei’s “hardscrabble days” as a small private company competing with foreign rivals in China had helped it ­become more innovative and ­customer-focused.

“It’s hard for me not to laugh when I hear people claim that Huawei is a creation of the Chinese government when we actually had to scrap for survival in our own country whilst American and European companies were making big profits from our own state-owned telcos,” Mr Liu said.

In their paper Who Owns ­Huawei, economist Christopher Balding and law professor ­Donald Clarke found the holding company was 1 per cent owned by founder Ren Zhengfei and 99 per cent owned by an entity called a “trade union committee”.

“We know nothing about the internal governance procedures of the trade union committee,” the academics said. “We do not know who the committee members or other trade union leaders are, or how they are selected.”

They said the company’s ­employee shareholdings were “at most contractual interests in a profit-sharing scheme”, and that given the public nature of trade unions in China, “Huawei may be deemed effectively state-owned”.

Huawei lawyer and spokesman, former senator Nick Xenophon, told The Australian such claims were “not credible”.

“I concede the ownership has been brought up as an issue and I don’t think it has merit,” he said.

“My concern is what happens here in Australia, and Huawei Australia has been a model corporate citizen for the last 16 years.

“My focus is on Huawei as a company. My primary focus is that things have been said about Huawei that are manifestly ­untrue.”