The UK will allow “high-risk vendors” like Huawei to supply equipment for its 5G network infrastructure, the government announced today. The announcement outlining the limitations imposed on high-risk vendors was made after weeks of speculation about the company’s role in the UK’s 5G infrastructure. All four of the UK’s major operators are already using the company’s equipment in their 5G networks.

The announcement defines high-risk vendors as those that “pose greater security and resilience risks to UK telecoms networks.” The country’s National Cyber Security Centre says that high-risk vendors will be allowed to supply non-core elements of the network, but they will be limited by a market share cap of 35 percent, which the government hopes will stop the country from becoming overly reliant on their equipment. Such vendors will be excluded entirely from critical core parts of the network, as well as sensitive geographic locations like military bases.

Network operators have previously distinguished between core and non-core parts of their network as a means of segmenting security. The non-core network mainly covers antennas and base stations that can be more easily isolated and secured. BT, for example, has removed Huawei equipment from the core of EE’s mobile network infrastructure, but it has allowed it to be used elsewhere.

The country’s Digital Secretary Baroness Nicky Morgan says that the decision strikes a balance between enabling infrastructure upgrades, without compromising national security. “High-risk vendors never have been and never will be in our most sensitive networks,” she said, adding that the decision “paves the way for secure and resilient networks, with our sovereignty over data protected, but it also builds on our strategy to develop a diversity of suppliers.”

The announcement is likely to anger officials in the Trump administration who have banned government use of Huawei’s tech and have prevented American firms from doing business with the company, citing national security concerns. The administration has since been lobbying fiercely for the UK to ban Huawei’s involvement in its 5G infrastructure. As recently as last Friday, the Financial Times reported that President Donald Trump personally discussed the issue with Prime Minister Boris Johnson in a phone call.

US national security adviser Robert O’Brien told the Financial Times that allowing Huawei into the UK’s 5G networks risks giving China access to the “most intimate” details of British citizens. “It is somewhat shocking to us that folks in the UK would look at Huawei as some sort of a commercial decision. 5G is a national security decision,” O’Brien said.

The UK will have to face the consequences of ignoring the US’s pleas as early as Friday, January 31st, when it leaves the European Union and starts the process of negotiating its own trade deals — of which, the US deal will be one of the most important.

There could also be consequences for intelligence sharing. According to Politico, Rep. Liz Cheney (R-WY) said that the US will have to “recalculate [and] reassess whether or not they can continue to be among the closest of our intel partners” if the UK approves the use of Huawei in their 5G networks. The UK and US are members of the “Five Eyes” intelligence-sharing agreement along with Canada, Australia, and New Zealand. 

While the US has been pushing for a ban, the UK’s telcos have been pushing back. In particular, Vodafone has argued that a complete Huawei ban would set back the country’s 5G infrastructure and Prime Minister Boris Johnson has said that there is a lack of alternatives to its equipment. A ban would also be costly for the telcos that are already using Huawei’s equipment in their networks. Vodafone has said it would cost the company “hundreds of millions” to strip the equipment out.

There has been fierce debate over the security of using Huawei’s equipment both nationally and internationally. The UK’s Huawei Cyber Security Evaluation Centre criticized Huawei’s cybersecurity competency in a report published last year, only for British intelligence to counter that the company’s equipment is a manageable risk. Last April, reports emerged that the British government was about to allow Huawei equipment in non-core parts of the network, but the official decision never materialized (and the minister who was thought to have leaked the decision was fired).

Today’s decision was initially delayed due to the uncertainty created by trade restrictions placed on Huawei by the US government, The Guardian noted, with the company’s fate seemingly having become tied up in the ongoing trade war between the US and China. Then, in November, the UK’s third general election in five years forced the government to delay its decision once again.

The delays have meant that the UK’s telcos have already started building out their 5G network infrastructure using Huawei equipment. The first of these, from EE, arrived in May 2019. Telcos across Europe have made similar arguments against banning Huawei, although Reuters notes a consensus is yet to emerge across the bloc.

Responding to the news, Huawei issued a statement saying that it was “reassured” by the government’s “evidence-based decision.” It pointed out that it has been supplying the UK’s telecoms operators with equipment for over 15 years.

Update January 28th, 8:02AM ET: This post has been updated to add Huawei’s response.