Prime Minister Jacinda Ardern says New Zealand has to make its own decisions about Huawei regardless of its intelligence relationships with Five Eyes members.
It comes after reports British intelligence believe it will be able to mitigate its security concerns about letting Huawei provide 5G technology in the United Kingdom.
That advice appears to be a push back against United States attempts to persuade allies to ban Huawei from their high-speed telecommunications systems.
Ms Ardern told Morning Report that New Zealand had its own processes and legislation to follow.
"It's called the Telecommunications Intersection Capability and Security Act. It is a framework that is agnostic to vendoring countries but it undertakes analysis via the GCSB (Government Communications Security Bureau) and independent of us around the data security of New Zealanders for any application we might receive for instance like the one that has been received by Spark.
"The GCSB have gone back to Spark, said they have had some concerns, and given them the option of mitigating those concerns ... that is where the process currently now sits so we are still midway through a process here."
She didn't believe the country was in a bind between the UK and the US.
"I think that's actually why it's so important to reflect on the fact that we do have our own process regardless of the intelligence relationships that we have. It exists to protect New Zealanders' security and ultimately, regardless of those relationships, maintain our own independent foreign policy...
"Our best interests here are making sure that it's independent, that it's not politicised, that's it's based on the national security and data security of New Zealanders, that whilst at the same time of course we have another interest at play here, our diplomatic relationship which is of course important to us, which we need to maintain the strength of. But that can not be seen to dictate the way that we look after our national security."
News of the UK intelligence stance on using Huawei was reported by The Financial Times in London.
One of the authors of the report, Demetri Sevastopulo, said: "The question is whether the British government, in a couple of months, will actually accept the conclusions that its own technicians have reached or is it possible they will come under political pressure from America and they will decide to override the decisions of their own technicians and decide to ban Huawei...
"It's easier to push back on these things if you're a superpower, you have a lot more leverage with China. It's much more difficult if you're a small country - New Zealand, the UK and other places, because the Chinese can apply massive pressure if they don't like something that you've done."
Security consultant Paul Buchanan said the UK advice would give the New Zealand government some "wiggle room" and relief when it came to Huawei.
"That's good news for both Huawei and the government because if it turns out the British can manage the risk ... there still is a risk by involving Huawei but they think there may be solutions to that," he said.
Fixes could potentially be found to block back doors into any network involving Huawei and that would be a win-win situation, according to Mr Buchanan.
"However, that doesn't address the larger issues of the relationship between Huawei and Chinese intelligence, which is a major concern ... and then the accusations that Huawei is a bad corporate actor who engages in intellectual property theft, copyright violation, that sort of thing."
Meanwhile, Spark is still deciding if it will try again to win the government spy agency's support for it to partner with Huawei to deliver the 5G mobile network.
The GCSB has rejected a previous bid to use the Chinese company's technology, citing security concerns.
Spark was not keen to comment on the UK's view on Huawei.
But a spokesperson has said Spark is still in discussions with security officials, working through what mitigation might be possible here.
The telecommunications firm has not yet decided, though, if it will even submit a proposal.
Technology commentator Paul Brislen believes it would be pointless, saying the GCSB wouldn't be likely to reconsider.
He said the other options are Nokia, which was found to be helping the Government of Iran to spy on pro-democracy protesters a decade ago; Ericsson, which would probably be very expensive; or the newer player, South Korea's Samsung.
The relationship with China
Ms Ardern told Morning Report it would be "naive not to suggest there hasn't been extra commentary" between New Zealand and China about relationships in recent days.
"It is complex, our relationship with China, but also important but we have had accusations of there being issues at the border, that changes in our people to people exchanges - those numbers are all up.
"We've looked specifically at those claims around the border. Issues at the border were ... statistically insignificant. Yes we need to manage the complexities of our relationship we also don't need to heighten alarm where it does not exist."
Claims the government had issues with Chinese visas were false, Ms Ardern said.
"We have never been denied any visas or had any issues in that regard."