Huawei is in the midst of the trade friction, also called the US-China Technology Cold War. Although it is a world-class technology company, little is known about its internal affairs. In the midst of this, Christopher Balding, an expert in Chinese economy and financial systems, and Professor Donald C. Clarke, an expert in Chinese law, analyzed the mystery of who makes Huawei run, drawing attention.
Through its official Twitter account, Huawei conducted a survey with the hashtag (#WhoRunsHuawei) about who the Huawei owners are. As a result, 42% think it is owned by the Chinese government. Huawei opened a website called Huawei Facts to disclose various data. One page mentioning Huawei owners states that Huawei is not a government-managed or third-party company, and that Huawei is owned and operated by its employees from the beginning.
However, Christopher Balding and others dismiss this as a myth that was created. In China, despite the saying that trade unions dominate enterprises, there is a contradiction that trade unions are not organized by workers.
Who do you think owns Huawei? #WhoRunsHuawei
— Huawei (@Huawei) August 2, 2019
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Huawei is not listed and all shares of the Huawei Group are held by Huawei Holdings, a holding company. Huawei Technologies, which operates Huawei’s actual business, is a subsidiary of Huawei Holdings. In addition, 1.14% of Huawei Holdings’ shares are owned by the founder, Chairman Ren Zhengfei, and the remaining 98.86% by an organization called Huawei Holdings TUC Trade Union Committee.
Accordingly, it is Huawei Holdings TUC that holds a stake in Huawei Holdings only, not Huawei Technology, which employs a large number of employees. Although there are labor unions at Huawei Technology, the only activities include donating employees or managing club activities after work, and there is no real power to be involved in the operation of the company.
Also, the concept of stock itself is clearly different from that of a general stock company. Ordinary stocks carry voting rights that are important for shareholders to participate in the management of the company. However, Huawei shares are nothing more than a simple written contract for profit distribution. Therefore, Huawei stocks are virtual stocks and limited phantom stocks, that is, virtual stocks.
Christopher Balding also mentioned the position of trade unions in China. China’s trade unions are officially controlled by ACFTU, the Federation of Trade Unions, the National Assembly of China, but the law stipulates that ACFTU is an organization belonging to the state. In fact, it is part of the Chinese Communist Party. In this regard, Christopher Balding says Huawei can be considered a de facto state-owned company.
In the end, when asked who specifically owns Huawei, Christopher Balding and others say that everything is unknown except for Ren Chung Pay, whose only name is known. He also added that he is convinced that whoever Huawei owner is, at least not an employee working for Huawei. Related information can be found here .