Contacted for the company's reaction, a Huawei spokesperson told iTWire: "We have been informed by the government that Huawei and ZTE have been banned from providing 5G technology to Australia. This is an extremely disappointing result for consumers.
"Huawei is a world leader in 5G and has safely and securely delivered wireless technology in Australia for close to 15 years."
A statement issued jointly by Acting Home Affairs Minister Scott Morrison and Communications Minister Mitch Fifield on Thursday said having any companies involved in the rollout who were subject to foreign laws that were in conflict with Australian law was too big a risk.
The government said that no amount of assurance from Huawei about not handling over Australian data to Chinese law enforcement was sufficient to mitigate any risk.
The statement said: "This new architecture provides a way to circumvent traditional security controls by exploiting equipment in the edge of the network – exploitation which may affect overall network integrity and availability, as well as the confidentiality of customer data.
“The government has found no combination of technical security controls that sufficiently mitigate the risks.”
Neither company was named in the statement, but it was made clear to telcos that involving either of the Chinese firms “may risk failure by the carrier to adequately protect a 5G network from unauthorised access or interference”.
“While we are protected as far as possible by current security controls, the new network, with its increased complexity, would render these current protections ineffective in 5G," it said.
“The government’s Telecommunications Sector Security Reforms, which commence on 18 September, place obligations on telecommunications companies to protect Australian networks from unauthorised interference or access that might prejudice our national security,” Morrison said.
Huawei was banned from bidding for contracts for Australia's national broadband network, the NBN, in 2012.
Australia has also acted to prevent the company participating in an undersea cable project linking the Solomon Islands and Papua New Guinea to Sydney.
American fears about the company extend back nearly a decade with the NSA having hacked into Huawei's offices in Shenzhen in 2010, according to documents released by whistleblower Edward Snowden.