The US Federal Communications Commission (FCC) has classified the China based companies Huawei and ZTE as threat for National security. This was based on their alleged tie ups with the Chinese intelligence services and the military. These two companies are now banned from the FCC’s Universal service fund which is a collection of subsidies through which the US government promotes access to the telecom services. Huawei and ZTE were suppliers under this Universal service funds.
This news has come right after the Indian Government has banned 59 Chinese apps due to security concerns. However, there is no ban or any other kind of action towards the hardware suppliers from China in the market.
The FCC’s official reports state that “ As a result of today’s action, money from the FCC’s $8.3 billion (approximately Rs. 62,676 crores) a year Universal Service Fund may no longer be used to purchase, obtain, maintain, improve, modify, or otherwise support any equipment or services produced or provided by these suppliers.“
The FCC chairman Ajit Pai stated that “With today’s Orders, and based on the overwhelming weight of evidence, the Bureau has designated Huawei and ZTE as national security risks to America’s communications networks—and to our 5G future”
“Both companies have close ties to the Chinese Communist Party and China’s military apparatus, and both companies are broadly subject to Chinese law obligating them to cooperate with the country’s intelligence services,” he added.
Huawei is a global Information and communication technology(ICT) provider company based in Beijing. ZTE is also a leading telecommunication company that started in Hong Kong. Both of these companies have been growing in the global market for decades.
The FCC chairman Ajit Pai said in a series of tweets that the decision to cut off these companies has been made by considering the reports from Congress executive branch, allies, Intelligence community and communication service providers.
“With this decision, we are sending a clear message: the U.S. Government, and this FCC in particular, cannot and will not allow the Chinese Communist Party to exploit vulnerabilities in U.S. communications networks and compromise our critical communications infrastructure.” he tweeted.