Washington DC:
The US Federal Communications Commission has designated Chinese firms Huawei and ZTE as “national security threats”, saying the major step was aimed at protecting American communications networks from security risks. The decision, which came on Tuesday and got in effect immediately, would also cover the firms’ parent body, affiliates and subsidiaries.
As a result of the action, money from the FCC’s USD 8.3 billion a year Universal Service Fund may no longer be used to purchase, obtain, maintain, improve, modify, or otherwise support any equipment or services produced or provided by these suppliers.
In the Orders issued on Tuesday, the Public Safety and Homeland Security Bureau bases its final designations on the totality of the evidence, including evidence supporting the Commission’s initial designations and filings submitted in the record by Huawei, ZTE, and other interested parties. The final designations of Huawei and ZTE are effective immediately. “With today’s Orders, and based on the overwhelming weight of evidence, the Bureau has designated Huawei and ZTE as national security risks to America’s communications networks—and to our 5G future,” said FCC Chairman Indian-American Ajit Pai. “Both companies have close ties to the Chinese Communist Party and China’s military apparatus, and both companies are broadly subject to Chinese law obligating them to cooperate with the country’s intelligence services,” Pai said.
He said the bureau took into account the findings and actions of Congress, the Executive Branch, the intelligence community, US allies, and communications service providers in other countries. “We cannot and will not allow the Chinese Communist Party to exploit network vulnerabilities and compromise our critical communications infrastructure. Today’s action will also protect the FCC’s Universal Service Fund—money that comes from fees paid by American consumers and businesses on their phone bills—from being used to underwrite these suppliers, which threaten our national security,” Pai said.
In November 2019, the Commission unanimously adopted a ban on the use of universal service support to purchase, obtain, or maintain any equipment or services produced or provided by companies posing a national security threat to the integrity of communications networks or the communications supply chain. The Commission proposed that Huawei and ZTE be covered by this rule because of their substantial ties to the Chinese government, Chinese law requiring them to assist in espionage activities, known cybersecurity risks and vulnerabilities in their equipment, and ongoing Congressional and Executive Branch concern about this equipment.
