FCC bans Huawei, ZTE, China based connected camera and 2-way radio makers

On Friday, the Federal Communications Commission (FCC) banned Huawei Technologies Co. and ZTE Corp. from selling electronics in the U.S. by regulators who say they pose a security risk, continuing a years-long effort to limit the reach of Chinese telecommunications companies into U.S. telecommunications networks.

The FCC also named connected-camera makers Hangzhou Hikvision Digital Technology Co. and Dahua Technology Co., as well as two-way radio manufacturer Hytera Communications Corp.

“The FCC is committed to protecting our national security by ensuring that untrustworthy communications equipment is not authorized for use within our borders, and we are continuing that work here,” Chairwoman Jessica Rosenworcel said in a news release. “These new rules are an important part of our ongoing actions to protect the American people from national security threats involving telecommunications.”

“On March 12, 2021, we published the first-ever list of communications and services that pose an unacceptable risk to national security as required under the Secure and Trusted Communications Networks Act. This initial Covered List included equipment from the Chinese companies Huawei, ZTE, Hytera, Hikvision, and Dahua. Since then, we’ve added equipment and services from five additional entities. Last year I also proposed stricter data breach reporting rules and worked with the Department of State to improve how we coordinate national security issues related to submarine cable licenses.”

In the 4-0 vote, the FCC concluded the products pose a risk to data security. Past efforts to curb Chinese access include export controls to cut off key, sophisticated equipment and software. Recently US officials have weighed restrictions on TikTok over fears Chinese authorities could access US user data via the video sharing app.

“This is a culminating action,” said Klon Kitchen, a senior fellow at the Washington-based American Enterprise Institute, a public-policy think tank. “Things that began under Trump are now being carried out. The Biden administration is continuing to turn the screws on these companies because the threat isn’t changing.”

Hikvision said its video security products “present no security threat to the United States and there is no technical or legal justification for the Federal Communications Commission’s decision.” The company said the ruling will “make it more harmful and more expensive for US small businesses, local authorities, school districts, and individual consumers to protect themselves, their homes, businesses and property.”

Huawei declined to comment, while Dahua, Hytera and ZTE didn’t respond to emails sent outside normal business hours in China.

The looming FCC move didn’t come up in the bilateral meeting between US President Joe Biden and Chinese President Xi Jinping in Indonesia last week, a US official said, speaking on condition of anonymity. Biden did discuss technology issues more broadly with Xi and was clear that the US will continue to take action to protect its national security, the official said.

“This is the death knell for all of them for their US operations,” said Conor Healy, director of government research for the Bethlehem, Pennsylvania-based surveillance research group IPVM.  “They won’t be able to introduce any new products into the US.”

Dahua and Hikvision stand to be affected most since their cameras are widely used, often by government agencies with many facilities to monitor, Healy said. Agencies including police also use handheld Hytera radios, he said.

In its order, the FCC also asked for comment on whether to revoke existing equipment authorization, Rosenworcel said in an online statement.

According to Healy, merchants could be stuck with gear that’s illegal to sell.

In 2018, Congress voted to stop federal agencies from buying gear from the five companies named by the FCC. The agency said earlier that the companies aren’t eligible to receive federal subsidies, and also has barred Chinese phone companies from doing business in the U.S.

The order released Friday was required under the Secure Equipment Act – a bill President Biden signed into law on November 2021.

The big picture: Huawei and ZTE are two of the world’s biggest suppliers of telecom equipment.

  • Countries including CanadaBritain and Australia have ramped up restrictions against the use of 5G technologies from Huawei and ZTE in recent years.
  • Huawei executives have previously said the company does not give data to the Chinese government and that its equipment is not compromised.
  • The company’s chief security officer Andy Purdy has also argued that a ban would hurt American jobs because it spends over $11 billion a year from American suppliers.

References:

https://www.bloomberg.com/news/articles/2022-11-25/fcc-bans-huawei-zte-telecom-equipment-from-sale-in-us-lawwfpb3

https://www.axios.com/2022/11/25/fcc-bans-huawei-zte-equipment-national-security

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