Ben Wallace was speaking at the defence and security arms fair DSEI, when he revealed the Government would publish a decision soon, but stopped short of providing a date.
Huawei has been subjected to intense scrutiny amid accusations of having close ties to the Chinese state, with some critics arguing that its telecoms equipment could be used to spy on people in the West.
The company has always strongly denied the claims, insisting it abides by the laws of each country in which it is present.
America has urged its allies – including Britain – not to use its equipment or face being cut off from US intelligence because of the “unacceptable risk” Huawei poses.
Stressing how it is “an important decision to make”, the former security minister said the assurance they can give the US is they will “not allow anything to compromise our sensitive networks in the UK”.
“However, as I have said publicly before, this is more than just technical, this is also about behaviour,” Mr Wallace told those gathered in London on Wednesday.
“It wasn’t that long ago that the United Kingdom and other nations called out China for some of its cyber activity, publicly.
“And if we are going to allow countries access to our markets, I think we should all expect a code of behaviour that is fair play and we all particularly believe in fair play.
“So I think that will all be reflected in those discussions.”
In the first keynote speech of his new Cabinet job, Mr Wallace also launched a bidding process to operate and maintain the country’s next generation military satellite communications system, Skynet 6.
With the first Skynet satellite launched in November 1969, he said the new system – set to replace Skynet 5 – will give “our forces unparalleled capacity to talk to each other in any hostile environment”.
He added: “Today we are having to deal with increasing threats to satellite-based navigation. So the need for robust communications has never been more vital.”
The successful industry partner will manage the ground stations, infrastructure and technology involved in the programme, Mr Wallace said – with the contract set to commence in September 2021.
Highlighting the changing nature of warfare, the Defence Secretary also touched on the “peril drone technology poses to our airspace”, citing disruptive incidents at Gatwick and Heathrow airports.
In December round 1,000 flights were cancelled or diverted across three days, affecting after drones were spotted inside the perimeter of Gatwick, the UK’s second biggest airport.
Mr Wallace announced how early next year the Royal Air Force will be working with aerospace company, Leonardo, on a three-year programme to look at “how to detect, track, identify and defeat rogue drones as this technology continues to evolve”.