US FCC has authority to ban Huawei equipment subsidies, appeal court rules
- A federal appeal court said the FCC was within its power to bar the use of ‘Universal Service Fund’ subsidies for equipment deemed a national security risk
- Huawei argued that the FCC lacked the expertise to determine whether its equipment posed a threat, which the court denied
The 5th Circuit Court of Appeals ruled that the Federal Communications Commission was fully within its power and competence to issue the rule barring “Universal Service Fund” subsidies recipients from buying equipment or services from companies deemed national security risks.
The three-judge panel also dismissed a claim by Huawei Technologies Ltd that the FCC lacked the expertise to designate the company’s equipment as a security risk to US telecommunications infrastructure.
“Assessing security risks to telecoms networks falls in the FCC’s wheelhouse,” the judges wrote in a 60-page opinion, rejecting any suggestion it was some sort of “junior-varsity” agency on national security matters.
Huawei did not immediately offer a response to the ruling.
Huawei sued the FCC in late 2019 after the agency voted to bar rural carriers from using government subsidies to buy equipment from Huawei or its Chinese rival, ZTE Corp. At the time, the company called the decision “based on politics, not security.” It claimed the FCC was exceeding its authority by making national security judgments.