China says telco gear makers operate according to market rules

China's foreign ministry said on Monday that Chinese telecoms companies operate according to market rules, urging the United States to "set aside prejudices" when it came to Huawei Technologies Co Ltd and ZTE Corp.

"Chinese telecoms companies have been developing their international business based on market economy principles. Their investment in the United States embodies the mutually beneficial nature of Sino-American economic and trade relations," said ministry spokesman Hong Lei.

China's top telecommunications gear makers should be kept from the U.S. market because they cannot be trusted to dodge Chinese state influence and thus pose a security threat, the U.S. House of Representatives' Intelligence Committee leaders said in a draft of a report to be released later on Monday.

(Reporting by Chris Buckley; Writing by Ben Blanchard; Editing by Ian Geoghegan)