BRUSSELS, Belgium: EU governments have proposed removing a fixed deadline for mobile operators to replace equipment from suppliers deemed high risk, after telecom companies warned that the changes could cost as much as 40 billion euros (US$45 billion).

A document dated September 22, seen by Reuters, shows that EU governments have removed the 36-month phase-out period proposed by the European Commission in January as part of an overhaul of the EU Cybersecurity Act.

The Commission's proposal called for components and equipment from high-risk suppliers to be phased out of critical sectors. The measures would mainly affect Huawei and other Chinese technology companies.

Under the changes proposed by EU governments, the time allowed for replacing equipment would instead depend on factors such as the level of risk, the lifecycles of products and infrastructure, equipment replacement cycles, interoperability requirements, and the availability of suitable alternatives.

Huawei denies that its equipment poses a security risk.

Europe has increased scrutiny of Chinese technology following cyber and ransomware attacks and amid concerns about foreign espionage.

Telecom operators have raised concerns about the cost of replacing existing equipment. In a joint letter earlier this month, Deutsche Telekom Chief Executive Timotheus Höttges and 16 other industry executives warned that costs of up to 40 billion euros could drain capital needed for investments in fiber, 5G and 6G networks.

A February research note by Strand Consult said Germany, Italy and Spain accounted for the largest share of equipment due to be replaced over the next five years. Deutsche Telekom and Vodafone rely heavily on Huawei equipment in some markets, according to the note.

EU countries must now negotiate the Commission's proposal and any amendments with EU lawmakers before the revised Cybersecurity Act can become law.