US telecoms regulator designates China’s Huawei, ZTE as national security threats
- US tech firms are banned from using Universal Service Fund to purchase or support any equipment or services provided by these suppliers
- The announcement is a step forward in restricting 5G technological equipment made by Chinese companies from entering US telecoms infrastructure
The US telecommunications watchdog on Tuesday designated two Chinese companies – Huawei Technologies and ZTE – as security threats and banned American firms from using a fund to purchase their products.
Federal Communications Commission Chairman Ajit Pai said in a statement: “Based on the overwhelming weight of evidence,” the agency has identified the two companies as well as their parents, affiliates, and subsidiaries “as national security risks to America’s communications networks – and to our 5G future”.
“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,” said Pai.
American tech firms will not be authorised to use money from the FCC’s annual US$8.3 billion Universal Service Fund to purchase or support any equipment or services provided by these suppliers, effective immediately.
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The Universal Service Fund, established in 1997, is a programme of telecoms subsidies for companies to purchase equipment and service to maximise telecoms services access in the country. The programme typically funds between US$5 billion to US$8 billion each year.