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January 31, 2013

Investigation of Attempted Skycom Sale of HP Gear to Iran Reveals Close Ties to Huawei

By David Delony, Contributing Writer

Skycom, a Hong Kong-based telecommunications company that attempted to sell HP electronics to Iran in violation of U.S. trade sanctions, has ties to Huawei (News - Alert), a Chinese electronics manufacturer.

Cathy Meng, Huawei’s CFO, served on the Skycom board of directors between February 2008 and April 2009. “We will honor our commitment to transparency and openness,” Meng told journalists in Beijing, at an event announcing the company’s financial results.

Skycom’s Iranian division attempted to sell approximately $1.77 million worth of HP equipment to Iranian mobile carrier Mobile Telecommunications Co. in 2010. The sale would have violated U.S. trade sanctions against the country.

Thirteen pages of the proposal were marked “Huawei confidential.”

Although the two companies appear to be separate entities, internal documents suggest a closer relationship between the two companies. A management company controlled by Huawei held all of Skycom’s shares in 2007, a Reuters (News - Alert) investigation found.

Meng also served as a secretary for the company at the time.

Many of the workers at Skycom’s Iranian division are apparently Chinese nationals, and some of them even listed their place of employment at “Skycom-Huawei” on their LinkedIn (News - Alert) profiles.

A London firm called International Company Profile, which prepares credit reports on companies, described Skycom in a 2010 report as “a subsidiary of Huawei Technologies Corporation.”

“The relationship between Huawei and Skycom is a normal business partnership,” the company said in a statement e-mailed to Reuters. “Huawei has established a trade compliance system which is in line with industry best practices, and our business in Iran is in full compliance with all applicable laws and regulations including those of the UN. We also require our partners, such as Skycom, to make the same commitments."

Other key Skycom employees also appear to have ties to Huawei. One director, Hu Mei, appeared to have a Huawei e-mail address and a listing in Huawei’s directory. Another former director, Wu Shuyuan also had a Huawei e-mail address and directory listing.

An Iranian press release from 2009 listed Skycom CEO Zhang Hongkai as “CEO from Huawei Iran Office.”

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Edited by Braden Becker
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