Trump eyes ban of Huawei, ZTE products: report

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President Trump is weighing an executive order to be signed as early as January to declare a national emergency and ban U.S. companies from using telecommunications equipment made by Chinese companies Huawei and ZTE, according to a Reuters report.

The move against the two large Chinese network equipment companies comes as the White House has leveled accusations that they work in concert with China’s government and their equipment could be used to spy on Americans.

{mosads}Reuters reports that the executive order has been under consideration for as long as eight months and would direct the Commerce Department to prohibit U.S. companies from buying equipment from foreign telecommunications makers that pose significant national security risks.

While the order may not directly name Huawei and ZTE, it is likely that the Commerce Department will interpret the order’s scope to include the two companies.

The decree would hinge itself on the International Emergency Economic Powers Act, which allows the president to regulate commerce in response to a national emergency.

The White House signed a bill in August that banned the U.S. government from using Huawei and ZTE equipment.

China’s Foreign Ministry spokeswoman Hua Chunying said the U.S. is moving forward with national security claims “without evidence.”

“It’s best to let facts speak for themselves when it comes to security problems,” she told Reuters.

“Some countries have, without any evidence, and making use of national security, tacitly assumed crimes to politicize, and even obstruct and restrict, normal technology exchange activities,” she added.

A White House official, who asked not to be identified, told The Hill that the Trump administration “is working across government and with our allies and like-minded partners to mitigate risk in the deployment of 5G and other communications infrastructure.”

“Communications networks form the backbone of our society and underpin every aspect of modern life. The United States will ensure that our networks are secure and reliable. We have nothing further to announce,” the official added.

Rural operators in the U.S., which account for some of Huawei’s and ZTE’s biggest customers as the company provides services that are less expensive, are concerned the executive order would require them to rip out existing Chinese-made equipment without compensation. Industry officials are split on whether that is legally possible. 

Huawei’s services are so central to rural communities that William Levy, vice president for sales of Huawei Tech USA, is on the board of directors of the Rural Wireless Association (RWA).

The RWA represents carriers with fewer than 100,000 subscribers and estimates that 25 percent of its members uses Huawei or ZTE equipment. 

Caressa Bennet, RWA general counsel, told Reuters that replacing Huawei or ZTE equipment could cost up to $1 billion. 

The FCC in April also granted initial approval to a regulation that withholds federal funds to help pay for telecommunication infrastructure from companies that purchase equipment from firms determined to pose a threat to U.S. national security, which many speculate was targeted at Huawei and ZTE. 

The Reuters report comes as Washington and Beijing each agreed earlier this month to postpone new tit-for-tat tariffs until January. A new round of trade talks between the world’s two largest economies is scheduled for next month. 

Tensions flared last month after the arrest of a Huawei executive in Canada on U.S. charges regarding suspected violations of sanctions imposed on Iran.

Updated at 12:31 p.m.

Tags China Donald Trump Huawei Telecommunications ZTE
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