US FCC Bans Use of Government Subsidies for Huawei and ZTE Equipment

Official Designation as a U.S. National Security Threat
Decision Made Immediately After Handling Hong Kong National Security Law

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The U.S. Federal Communications Commission (FCC) on the 30th (local time) officially designated Chinese telecommunications equipment companies Huawei and ZTE (Zhongxing Telecommunications) as threats to U.S. national security.

The FCC issued an order designating the two companies as national security threats, prohibiting U.S. companies from using government subsidies to purchase equipment from these companies. The FCC's action came shortly after China decided to implement the Hong Kong National Security Law.

The FCC stated that this measure means many small telecommunications companies can no longer use federal government subsidies to purchase new equipment from Huawei or ZTE or to maintain existing equipment.

The U.S. federal government provides subsidies to small and medium wireless telecommunications companies or internet service providers serving low population density areas.

FCC Chairman Ajit Pai said in a statement, "Both Huawei and ZTE have close ties with the Chinese Communist Party and China's military organizations," adding, "The United States cannot and will not allow the Chinese Communist Party to exploit network vulnerabilities and damage critical communications infrastructure."