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Chinese telecoms groups Huawei and ZTE barred from US sales

Washington’s top telecommunications regulator has barred China-based Huawei and ZTE from selling equipment in the US, citing national security concerns in a move that could further fuel tensions with Beijing.

The Federal Communications Commission announced the step on Friday, saying it was the latest effort by US authorities to “build a more secure and resilient supply chain” in the telecommunications industry.

“The action we take today covers base station equipment that goes into our networks. It covers phones, cameras, and WiFi routers that go into our homes. And it covers rebranded or ‘white label’ equipment that is developed for the marketplace. In other words, this approach is comprehensive,” said Jessica Rosenworcel, chair of the FCC.

The unanimous decision by FCC commissioners implements a 2021 law enacted by US president Joe Biden and completes a crackdown on companies such as Huawei and ZTE that intensified in recent years and become a symbol of the broader fissures between Washington and Beijing in trade and technology.

It comes after Biden implemented sweeping export controls affecting the Chinese semiconductor industry and met with Xi Jinping, China’s president, on the sidelines of the G20 summit in Indonesia earlier this month.

“It’s the first time — ever — that the FCC has banned electronics equipment on US national security grounds,” said Alexis Serfaty, an analyst at the Eurasia Group. “This gives you an idea both of the unique position in which Huawei finds itself but also the seriousness with which the US government has been scrutinising the Chinese telecom giant.”

The FCC had already stopped authorising the purchase of Huawei and ZTE equipment in the US using federal funds, but the move on Friday will also cover entirely private transactions.

Rosenworcel said that in addition, the FCC would ban the sale of telecommunications and video surveillance equipment from Chinese groups Hytera, Hikvision and Dahua used for “public safety, security of government facilities, physical surveillance of critical infrastructure, and other national security purposes” until they introduced certain “safeguards” on those sales.

The US government has long had Huawei in its crosshairs, but increased its hostility towards the company during the Trump administration, when it placed the company on an export blacklist kept by the commerce department and sought to persuade allies and partners to ditch Huawei equipment, with varying degrees of success.

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