Swedish regulators on Tuesday banned the use of telecom equipment from China’s Huawei and ZTE in its 5G network ahead of the spectrum auction scheduled for next month, Reuters reported.

The Swedish Post and Telecom Authority (PTS) said the setting of the 5G licence conditions followed assessments by the Swedish Armed Forces and security service.

European governments have been reviewing the role of Chinese companies in building their networks following pressure from the United States, which says they pose a security threat because, among other concerns, Chinese companies and citizens must by law aid the state in intelligence gathering.

Sweden’s security service called China “one of the biggest threats against Sweden”.

United Kingdom in July ordered Huawei equipment to be purged completely from Britain’s 5G network by 2027.

Huawei and ZTE did not immediately respond to requests for comment on the decision by Sweden, home to Ericsson.

“The ban leaves network operators with less options and risks slowing the rollout of 5G in markets where competition is reduced,” said Ben Wood, chief of research at CCS Insight.

The ban is likely to benefit rival telecom equipment makers Ericsson, Nokia from Finland and Samsung from Korea.

PTS said companies taking part in the auction must remove Huawei and ZTE gear from existing central functions by Jan. 1 2025.

The regulator defined central functions as equipment used to build the radio access network, the transmission network, the core network and the service and maintenance of the network.

PTS said the licence conditions were decided to address the assessments made by the armed forces and security service.

It has approved the participation of Hi3G Access, Net4Mobility, Telia and Teracom in the planned spectrum auction of 3.5 GHz and 2.3 GHz, key bands crucial for the rollout of 5G.

Tele2 and Telenor will participate together as Net4Mobility to secure spectrum for a joint nationwide 5G network.

Tele2, which uses Huawei equipment in its network, said the PTS decision “does not change our plans substantially”.

“We may have to phase different costs differently between years to meet security conditions on time,” a spokesman told Reuters.

The 5G spectrum auction was originally planned for early 2020, but last year PTS said it would delay the auction due to a security review. PTS announced in April this year that the auction would begin in November.