US to tighten telecoms restrictions on Huawei and ZTE

US president Joe Biden has signed legislation that will tighten restrictions for Chinese giants and ZTE, among others.

Biden signed the Secure Equipment Act into law yesterday (11 November), preventing companies that are deemed to be national security risks from receiving new telecoms licences from regulators in the US.

The law requires the US Federal Communications Commission (FCC) to establish rules stating that it won’t review or approve applications for communications equipment or services that “pose an unacceptable risk to national security or the security and safety of US persons”.

Last year, the FCC designated Huawei and ZTE as national security threats, citing close ties to the Chinese Communist Party and China’s military apparatus. The move prevented US businesses from using federal funding to purchase equipment from Huawei or ZTE.

After the US Senate passed the Secure Equipment Act last month, FCC commissioner Brendan Carr said it would strengthen national security and close the “Huawei loophole”.

This referred to companies not being able to purchase equipment with federal funding from Huawei, ZTE and other entities deemed security threats, but still being able to purchase if federal dollars aren’t involved.

“This legislation … will help to ensure that insecure gear from companies like Huawei and ZTE can no longer be inserted into America’s communications networks,” Carr added.

“We have already determined that this gear poses an unacceptable risk to our national security, so closing what I have called the ‘Huawei loophole’ is an appropriate action for us to take.”

US and China

The US placed Huawei on an entity list in May 2019 due to security concerns, essentially barring US companies from doing business with the Chinese telecoms giant without government approval.

Restrictions have continued to intensify since then, but Huawei has repeatedly denied posing any threat to US national security. ZTE has made similar comments.

The Secure Equipment Act is the latest effort by the US to crack down on Chinese tech and telecoms, increasing tensions between the two nations.

Biden and Chinese leader Xi Jinping are expected to meet virtually next week. In a briefing earlier this week, US principal deputy press secretary Karine Jean-Pierre said the meeting is “part of our ongoing efforts to responsibly manage the competition between our countries”.

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