The European Commission has ignored U.S. calls to ban Chinese telecom equipment supplier Huawei as it announced a series of cybersecurity recommendations for next-generation mobile networks. Huawei said in a statement it welcomed the Commission’s “objective and proportionate” recommendations. “Huawei understands the cybersecurity concerns that European regulators have. Based on mutual understanding, Huawei looks forward to contributing to the European framework on cybersecurity. We are firmly committed to continuing working with all regulators and partners to make the 5G roll-out in Europe a success”, Huawei said.

In its guidance for the roll-out of 5G telecom systems in the coming years, the Commission urged member states to assess cyber threats to the 5G infrastructure in their national markets. That information should then be shared among EU countries as part of a coordinated effort to develop a “toolbox of mitigating measures” and minimum common standards for 5G network security by the end of the year, according to the recommendations. It is a setback for the United States, which has been lobbying allies in Europe to boycott Huawei over fears its equipment could be used by the Chinese government to carry out cyber espionage.

The EU Commissioner for the Digital Single Market, Andrus Ansip, acknowledged those concerns, saying they stem from Beijing’s 2017 intelligence law that compels Chinese companies to assist in intelligence gathering. “I think we have to be worried about this,” Ansip said at a press briefing in Strasbourg, France. However, the EU Commission prefers to secure Europe’s critical digital infrastructure with a more nuanced approach, rather than bowing to U.S. pressure for blanket bans. Huawei has repeatedly insisted there has never been evidence it was responsible for any security breaches. The Commission’s guidance is non-binding, but EU countries often use it as the basis for joint policies.

Huawei announced that its annual revenue rose 19.5% to CNY721.2 billion (or more than USD100 billion), with profit up 25% to CNY59.3 billion. Smartphones and other consumer goods comprised the bulk of earnings, with the carrier business slightly down on last year, although it is forecast to jump as 5G network contracts are signed. Huawei has already signed contracts accounting for 28% of the global market. The company also called on other telecom vendors to open up their source code to scrutiny. Huawei is the only major telecoms equipment vendor that not only ensures the safety and credibility of its products, but also allows a British watchdog to review and test source codes to ensure safety, Guo Ping, Huawei’s rotating Chairman, said during the company’s annual results conference in Shenzhen. “We’ve raised the bar in the industry to ensure not only the products tested during delivery are safe, but our entire development processes are also credible,” he said. “That’s why we opened our source codes for testing. I believe that through this practice we are setting an example for the whole industry, hoping other vendors will keep up with us and do not lag behind.”