US FCC Classifies Huawei and ZTE as Security Threats, Cuts off Funding

By formally designating Chinese firms Huawei and ZTE as threats to United States national security the Federal Communications Commission has barred US firms from tapping an $8.3bn government fund to purchase equipment from the companies [File Hannibal H

The US Federal Communications Commission has blacklisted Chinese tech firms Huawei and ZTE and their subsidiaries as "national security threats", barring US firms from using government funds to do business with them.

None of these issues have particularly pressing importance at the moment, but the declaration does come as the culmination of a federal process to exclude and purge products from Huawei and ZTE from the wireless grid, especially in rural regions.

The FCC has taken an increasingly hard line against Chinese firms.

According to FCC's orders, Huawei and ZTE are considered highly susceptible to influence and coercion by the Chinese government, military, and intelligence community.

In April, the FCC said it may shut down U.S. operations of three state-controlled Chinese telecommunications companies.

"The Federal Communications Commission today took a major step in its ongoing efforts to protect USA communications networks from security risks", the FCC said. In a news release explaining the decision, the FCC said that this is a step to protect USA networks fro security risks. The fund is a collection of subsidies through which the USA government can promote access to telecom services.


"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".

Huawei and ZTE did not immediately respond to requests for comment but have previously sharply criticised the FCC's actions.

Also during 2019, in May, the FCC blocked China Mobile, another Chinese telecom giant, from offering worldwide telecom services using US networks.

The two companies have been banned as suppliers under the FCC's Universal Service Fund.

Huawei has been repeatedly banned and blacklisted by the United States government, which has also pressured allies including the UK and Germany to bar the market-dominating Chinese firm from their nascent 5G infrastructure.

The FCC granted its approvals to the firms more than a decade ago.

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