Huawei and ZTE are sources of concern for U.S. officials

Congress has restricted the Pentagon from procuring gear from China manufacturers, Huawei and ZTE, surrounding security threats.

Leah Williams | Apr 17, 2018

United States law regulators repositioned towards a restriction on China equipment makers as security hazards, supporting a prohibition on federal subsidies to buy networking gear from manufacturers such as Huawei and ZTE Corp.

On Tuesday, the Federal Communications Commission voted 5-0 in favor of barring federal funds from being spent with companies determined to be a risk to United States national security. The ban will be finalized when a second vote by the FCC is completed, with a noted congressional investigation of Huawei and ZTE as possible security threats.

"For years, U.S. government officials have expressed concern about the national security threats posed by certain foreign communications equipment providers in the communications supply chain," FCC Chairman Ajit Pai said. "Hidden 'backdoors' to our networks in routers, switches, and other network equipment can allow hostile foreign powers to inject viruses and other malware, steal Americans' private data, spy on U.S. businesses, and more."

The initiatives come as trade tensions grow between the United States and China. President Trump has threatened tariffs on $150 billion in Chinese imports in retribution for violations of intellectual property rights, while Beijing has promised to retaliate. On Monday, the Commerce Department blocked ZTE from exporting sensitive technology from America, claiming the company made false statements to officials of the United States.
Numerous carriers that service remote areas rely on companies like Huawei and ZTE, and could suffer "significant economic hardship" from the FCC's proposal, Steve Berry, president of CCA, a trade group for smaller wireless providers, said in an emailed statement.