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Operational Compliance

Adherence to business ethics, international conventions, and laws and regulation is the cornerstone of Huawei’s operational compliance worldwide. This reflects our unwavering commitment to integrity. We advocate fair competition, ensure trade compliance, protect intellectual property rights, and oppose bribery and corruption. We have benchmarked ourselves against leading industry practices, embedded compliance requirements into our corporate policies, regulations, and processes, and set up professional teams to manage compliance.

Compliance Management

Operational compliance is always our first priority, and compliance requirements have been integrated into our routine operations. In key areas such as trade compliance (export controls) and cyber security, we have established a compliance management system in accordance with industry standards that has been scrutinized by third-party auditors. To ensure compliance, we hold frequent talks with government agencies, and obtain the necessary approvals and licenses. To enhance our transparency and earn trust from stakeholders, we maintain routine communication with them. Together, we have created a favorable business environment and defined full compliance as a baseline.

The Legal Affairs Department provides legal guidance on building a global compliance system, trade compliance, IPR protection, anti-bribery and anti-corruption, and HR management. The department also conducts issue identification and evaluation, specifies compliance requirements, and releases warnings about internal and external legal risks. This helps other departments ensure legal compliance throughout their operations.

Building a Global Compliance System

In 2015, we stepped up efforts to establish effective compliance systems in subsidiaries outside China. In terms of organization, we appointed and trained compliance officers in 85 key countries. In terms of business management, we engaged professional consultants to manage compliance risks based on feasible methodologies. As a result, our subsidiaries ensured effective compliance management process and results. In addition, we established supervisory organizations in subsidiaries outside China to systematically oversee operational compliance. In 2015, our subsidiaries in 122 countries presented a total of 235 compliance reports to local supervisory organizations, thereby achieving operational compliance and aligning their compliance management goals with Huawei’s operational compliance strategy.

Anti-bribery and Anti-corruption

Integrity is at the heart of our operations, and we have zero tolerance for bribery or corruption. We have launched various activities to increase employees’ awareness of ethics and legal compliance. For example, all employees are required to understand and sign our Business Conduct Guidelines (BCGs), and pass an online test on the subject every year. To enhance our positive influence on suppliers, we have included strong ethical provisions in all contracts with suppliers, and require them to understand and sign the Honesty and Integrity Agreement. In addition, we have established complaint channels through which employees and other parties can report unethical and illegal behavior.

Trade Compliance

We conform to the trade laws and regulations of the countries and regions in which we operate. Through policies, organizations, processes, systems, and tools, we have embedded compliance requirements into the business activities of all functional departments. We have also established an end-to-end Internal Compliance Program (ICP), which was been highly praised by authoritative third parties during assessments and audits. The ICP has gone a long way toward mitigating the import and export control risks faced by our business units.

We keep a close watch on changes in international trends, remain sensitive to compliance issues, and promptly and effectively identify compliance risks in key countries and regions. We also engage in regular communication with government authorities, industry peers, and partners.

Protecting Intellectual Property Rights

Huawei respects the intellectual property rights (IPR) of others, complies with international IPR laws, and resolves IPR issues through negotiation, cross-licensing, and product cooperation in an open, positive, and friendly manner. We also employ legal means to protect ourselves against malicious infringements on our IPR.

Huawei is one of the world’s largest patent holders and investors in R&D, so protecting IPR is in our best interest.

As of December 31, 2015, we had filed 52,550 patent applications in China and 30,613 outside China, with a total of 50,377 granted.

Huawei had become a member of over 300 standards organizations, industry alliances, and open source communities, holding more than 280 important positions. We are also a board member of IEEE-SA, ETSI, WFA, TMF, OpenStack, Linaro, OASIS, and CCSA. We submitted more than 5,400 proposals in 2015, with the total number exceeding 43,000.

In 2015, we ranked first in terms of invention patents in China, 9th in Europe, and 23rd in the US.