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Big Brother in Iran: With A Little Help From Chinese and European Companies

by Pratap ChatterjeeSpecial to CorpWatch
March 27th, 2012

Mad Graffiti Week Iran Poster. Photo: United4Iran. Used under Creative Commons license

Big Brother is watching Iranians with a little help from Chinese and European companies. Reuters revealed last week that ZTE Corporation, a major Chinese telecommunications company, had sold Tehran surveillance technology that is “capable of monitoring landline, mobile and internet communications.” This comes in wake of revelations late last year by the Wall Street Journal that Creativity Software in the UK and Huawei in China had sold the Iranians location tracking equipment.

Steve Stecklow of Reuters reported on March 22 that Shenzhen-based ZTE sold Telecommunication Company of Iran (TCI) a $130.6 million package of networking equipment. TCI is the biggest telecommunication provider in Iran while ZTE sold equipment to more than 500 buyers in more than 160 countries for an annual revenue of $10.6 billion in 2010.

The ZTE equipment in question is called the ZXMT system which does "deep packet inspection” – that allows buyers to reconstruct individual web and email traffic and block users from accessing certain web sites.

Li Erjian, a ZTE spokesman in China, initially emailed Reuters to say that there was nothing unusual about the sale: "We sell standard equipment in Iran as we do globally,” he wrote. But Mahmoud Tadjallimehr, a former telecommunications project manager in Iran, told Reuters that the equipment was able "to locate users, intercept their voice, text messaging ... emails, chat conversations or web access."

And Privacy International says that ZTE has pursued business in Iran for a while. The London-based NGO obtained a copy of a May 2008, ZTE presentation to the Iran Telecommunication Research Center about the "ZTE Lawful Intercept Solution” among other products.

ZTE surveillance equipment was also found in Libya after the fall of Gaddafi’s regime.

ZTE pulled back from the project immediately after the Reuters report came out. The very next day, ZTE spokesman David Shu told Reuters: "We are going to curtail our business in Iran.” On March 27, the Chinese company sent out a statement that said: “"Due to local issues in Iran and its complicated relationship with the international community, ZTE has restricted its business practices in the country since 2011. ZTE no longer seeks new customers in Iran and limits business activities with existing customers."

ZTE is not the only company to sell such equipment to Iran. In 2009, Nokia Siemens Network was revealed to be supplying Iran with surveillance equipment. The company subsequently backed out of Iran because of protests and sanctions.

Last October, after the Journal revealed Creativity Software and Huawei's role in Iran, Bloomberg followed up with a report that Stockholm-based Ericsson AB and Dublin-based AdaptiveMobile Security Ltd. had sold Iran location tracking and text-message monitoring equipment.

Ericsson initially sold a mobile- positioning center for customer billing purposes to MTN Irancell Telecommunications Services Company, Iran’s second-largest mobile provider. Ericsson decided in October 2010 that it would stop selling products to Iran because of sanctions. AdaptiveMobile offered Iran equipment to “filter, block and store cell phone text messages” according to Bloomberg. The company claims the technology is to beat spam, viruses and “inappropriate content” not for repression, but has also decided to pull out of Iran because of sanctions. Huawei did the same.

The technology provided by Creativity Software allows buyers to get reports every 15 seconds about mobile phone users location. The company maintains, however, that it has not sold equipment for human rights abuse. “Any connection implied between technology supplied by CS and any alleged human rights abuses in Iran in 2009 are clearly erroneous,” the company announced in a statement issued last November. “Please also be aware that the use of the term “Surveillance equipment” in describing location based services technology is both pejorative and inappropriate, the statement added.

For more information on the boom in surveillance technology sales to governments around the world, please see: “State of Surveillance”