What kept happening, from the perspective of people who worked there that I've talked to, was that Nortel would do heavy R&D investments and then a few months later Huawei would be selling identical hardware with zero R&D budget- for lower cost, naturally. It took Nortel years to finally figure out their network was highly compromised, likely by the PLA[0]. The PLA would steal industrial secrets and hand them to companies owned or controlled by the Chinese government, like Huawei.
One fellow I met at a wedding party once told me how he had actually read Huawei source code that included Nortel copyright notices. It was a joke by the end. Everyone knew.
As for as being an arm of the PRC, Huawei claims they're owned by their employees Trade Union. But Trade Unions in China, by law, are highly controlled and managed by the party. You can't have a trade union that isn't highly associated with the Communist Party. Huawei counter these arguments by saying it's very complex- but provide no evidence to the contrary.[1]
[0]https://en.wikipedia.org/wiki/Criticism_of_Huawei#Nortel
[1]https://en.wikipedia.org/wiki/Criticism_of_Huawei#Opaque_own...