Britain on Tuesday greenlighted a limited role for Chinese telecoms giant Huawei in the country's 5G network, but underscored that "high risk vendors" would be excluded from "sensitive" core infrastructure. London's decision, following a meeting of the National Security Council chaired by Prime Minister Boris Johnson, came shortly after Brussels said it would allow Huawei a limited 5G role in the European Union.
"We want world-class connectivity as soon as possible but this must not be at the expense of our national security," Britain's Digital Secretary Nicky Morgan said in reference to high-speed fifth generation networks that offer almost instantaneous and reliable data transfer.
"High risk vendors never have been and never will be in our most sensitive networks," she insisted. Huawei welcomed news that it would have at least a limited role in building Britain's high-speed fifth generation networks, after Washington lobbied hard for the company to be sidelined completely on security concerns.
"Huawei is reassured by the UK government's confirmation that we can continue working with our customers to keep the 5G roll-out on track," said Huawei Vice-President Victor Zhang. "This evidence-based decision will result in a more advanced, more secure and more cost-effective telecoms infrastructure that is fit for the future."
Washington has banned Huawei from the rollout of the next generation mobile networks because of concerns - strongly denied - that the firm could be under the control of Beijing. Unlike the United States, Britain has been using Huawei technology in its systems for the past 15 years.
The US had threatened to limit intelligence sharing with London in the event of Huawei winning a UK role. All eyes will now be on Washington's response to Tuesday's announcements. The matter could hinder the chances of a favourable Britain-US trade deal after Brexit, according to analysts.
Johnson on Monday insisted that the UK can have "technological progress" while preserving national security. There has been intense debate in Europe and the US about whether or not to exclude Huawei from developing 5G. However in Brussels on Tuesday, a top European Union official said the bloc would not ban Huawei and would instead impose "strict" rules.
US President Donald Trump has already ordered American firms to cease doing business with market leader Huawei, and urged allies to follow suit. Trump's Secretary of State Mike Pompeo on Sunday declared that Britain faced a "momentous decision".
Huawei is widely viewed as providing the most advanced alternative for super-fast data transfers behind technologies such as self-driving cars and remotely operated factory robots. Existing providers of limited 5G network infrastructure in Britain include Nokia and Ericsson, while non-core elements include antennae and base stations attached to masts and roofs.
A number of UK mobile phone operators, including EE and Vodafone, currently sell 5G services - but it is so far available only in a handful of cities, notably London and Birmingham.