US bars China’s Huawei, ZTE from subsidy programme over security risks

The US Federal Communications Commission (FCC) voted 5-0 Friday to designate China’s Huawei and ZTE as national security risks, barring their US rural carrier customers from tapping an $8.5 billion government fund to purchase equipment.

The US telecommunications regulator also voted to propose requiring those carriers to remove and replace equipment from Huawei Technologies Co Ltd and ZTE Corp from existing networks. The move could eliminate a key source of funding for Huawei’s biggest US business – telecoms equipment.

This is the latest in a series of actions by the US government aimed at barring American companies from purchasing Huawei and ZTE equipment. Huawei and ZTE will have 30 days to contest the designation and a final order compelling removal of equipment is not expected until next year at the earliest.