The UK government has approved the supply of equipment by Chinese telecoms firm Huawei for the UK's new 5G data network despite warnings of a security risk. There is no formal confirmation but the Daily Telegraph says Huawei will build non-core components such as antennas.
The US wants its allies in the Five Eyes intelligence grouping - the UK, Canada, Australia and New Zealand - to exclude the company. But Huawei has denied that its work poses any risks of espionage or sabotage.
However Australia has already said it is siding with Washington - which has spoken of serious concerns over Huawei's obligations to the Chinese government and the danger that poses to the integrity of telecommunications networks in the US and elsewhere.
A spokesman for the Department for Digital, Culture, Media and Sport has said it is reviewing the supply of equipment for the 5G network and will report in due course.
Digital minister Margot James responded to the reports by tweeting: In spite of Cabinet leaks to the contrary, final decision yet to be made on managing threats to telecoms infrastructure.
According to the Daily Telegraph, Huawei would be allowed to help build the non-core infrastructure of the 5G network.
This would mean Huawei would not supply equipment for what is known as the core parts - where tasks such as checking device IDs and deciding how to route voice calls and data take place.
Huawei, a private company which already supplies equipment for the UK's existing mobile networks, has always denied claims it is controlled by the Chinese government.
It said it was awaiting a formal announcement, but was pleased that the UK is continuing to take an evidence-based approach to its work, adding it would continue to work cooperatively with the government and the industry.
Ciaran Martin, the head of the National Cyber Security Centre - which oversees Huawei's current UK work - told BBC Radio 4's Today program a framework would be put in place to ensure the 5G network was sufficiently safe.
Asked about the potential of a conflict in the position of Five Eyes members, he added: In the past decade there have been different approaches across the Five Eyes and across the allied wider Western alliance towards Huawei and towards other issues as well.
5G is the next (fifth) generation of mobile internet connectivity, promising much faster data download and upload speeds, wider coverage and more stable connections.
The world is going mobile and existing spectrum bands are becoming congested, leading to breakdowns, particularly when many people in one area are trying to access services at the same time.
5G is also much better at handling thousands of devices simultaneously, from phones to equipment sensors, video cameras to smart street lights.
Current 4G mobile networks can offer speeds of about 45Mbps (megabits per second) on average and experts say 5G - which is starting to be rolled out in the UK this year - could achieve browsing and downloads up to 20 times faster.
Foreign Affairs Committee chairman Tom Tugendhat tweeted that allowing Huawei to build some of the UK's 5G infrastructure would cause allies to doubt our ability to keep data secure and erode the trust essential to #FiveEyes cooperation.
Speaking on the Today program, Mr Tugendhat said the proposals still raised concerns, as 5G involved an internet system that can genuinely connect everything, and therefore the distinction between non-core and core is much harder to make.