Australia has barred China’s Huawei from bidding for contracts on the country’s US$38 billion National Broadband Network (NBN).
In Shenzhen a Huawei official said the company was informed by the Australian government that it is barred from the tendering process and is disappointed with the decision.
In a statement Huawei said it will continue to be open and transparent and work towards finding ways of providing assurance around the security of the company's technology.
In Beijing the Ministry of Commerce spokesman Shen Danyang described the Australian government's decision as surprising and unjust.
Huawei is the world's second largest telecommunications equipment maker and has worked on similar networks in the UK, New Zealand, Singapore and Malaysia.
NBN is a massive project that aims to connect 93 per cent of Australian homes and workplaces with optical fibre, fixed wireless and satellite technologies, providing high-speed broadband services in the urban and regional areas.
The plan was conceived in 2009 and is scheduled to be completed by June 2020.
Work on started on 1 April and will continue through to 30 June 2015 under the first three-year rollout plan, which will see 3.5 million homes, businesses, schools and hospitals having access to NBN fibre services.
Huawei has been operating in Australia since 2004.