Dutch telecom's bid to keep Chinese kit fails as court backs spy agency fears

Telecom provider Odido has lost an appeal regarding the replacement of network components from Huawei and ZTE in critical parts of its mobile network.

In 2018, the General Dutch Intelligence Agency (AIVD) and the Dutch Military Intelligence and Security Service (MIVD) recommended taking additional measures within the telecom sector due to an increase in cyber espionage.

An interdepartmental task force on economic security performed a risk analysis, detailing the vulnerabilities of mobile networks. The task force concluded that additional security measures were needed to protect the communication networks.

This led to new legislation, giving the Minister the authority to require telecom providers to use only equipment from so-called trusted suppliers in critical parts of their networks.

To manage risks to the security and integrity of its network, Odido was ordered to remove and replace components from Huawei and ZTE. The telecom company appealed the decision at the District Court of Rotterdam in October 2023, but to no avail.

That’s when Odido decided to appeal the court’s decision at the Court of Appeal. However, the Court of Appeal now confirms the ruling of the District Court of Rotterdam.

According to the Court of Appeal, the Dutch Telecommunications Act provides a legal basis for the imposed measure by the Minister, and isn’t contrary to Europe’s Electronic Communications Code. On top of that, the Court of Appeal ruled that a supplier ban is an appropriate organizational and technical measure to improve the security of the critical parts of a communications network.

Furthermore, the Court of Appeal finds that Odido isn’t entitled to statutory or any other damages, because the extent of the damages caused by the replacement of the network equipment is negligible.

“In the view of the Court of Appeal, the compensation that the Minister has already awarded to Odido is entirely discretionary and is not based on any policy. The Court is therefore unable to review that decision,” the ruling states.

The Court of Appeal’s verdict is final, and Odido no longer has the option to appeal its decision.

Unlock more exclusive Cybernews content on YouTube.