The damning verdict comes after the telco giant notified Andrew Hampton - Director-General of the GCSB - in accordance with the requirements of the Telecommunications Act 2013, of its proposed approach to implementing 5G technology on the Spark mobile network.
New Zealand's electronic intelligence agency has told the country's largest internet company it can't use technology from China's Huawei to upgrade its network due to significant security concerns.
USA lawmakers have warned Canada to keep Huawei out of its 5G network plans, and American officials are reportedly pressuring Germany, Italy and Japan to stop using Huawei telecommunications equipment.
Spark says it has not yet had time to review the decision in detail.
"I have informed Spark that a significant network security risk was identified", Hampton added.
A woman stands at the booth of Huawei featuring 5G technology at the PT Expo in Beijing, China September 28, 2018.
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A trilateral meet with US President Donald Trump and Japanese Prime Minister Shinzo Abe is also on the cards . That's changing thanks to Trump's tariffs, with Chinese importers looking elsewhere for a plentiful supply.
Banning Huawei 5G is a wrong decision as it would not just slow down the overall 5G process, but it would also be affecting the economic trading of the country as well. However, the company stressed that this ban would not affect the company's plans to launch a 5G network by 1 July 2020.
"The difference between 5G networks and conventional 4G and 3G networks is the configuration of the technology", Little said.
Such shunning is no small matter, as Huawei is now the world's biggest telecommunications equipment manufacturer.
"Huawei is aware of Spark's statement, and we are looking into the situation", said a Huawei spokesperson in emailed comments.
The TICSA process could ultimately end with Little being required to make a decision on whether to approve the network, but Little said the process was "nowhere near that point at this stage".
Australian Signals Directorate (ASD) Director-General Mike Burgess last month said his agency had recommended the Huawei and ZTE 5G ban because the stakes surrounding 5G could not be higher, as it will see telecommunications networks move to the top of critical national infrastructure lists, and because of concerns that the separation between edge and core networks has diminished, meaning vendors cannot be confined to the edge. Even more recently, Germany's government was reported to be considering a 5G ban on Huawei and ZTE.
Spark rival 2degrees said it had noted the decision and was "seeking clarity on it".