US House to Vote on Bill to Crack Down on Huawei, ZTE Amid Security Concerns

The House of Representatives is set to vote next week on a bill to crack down on Chinese telecommunications companies Huawei and ZTE Corp that have been deemed security threats by the US government.

The House said on Tuesday it will take up a bipartisan bill called the Countering Untrusted Telecommunications Abroad Act that would require the State Department to report on US NATO allies and others using telecommunication equipment or services in their 5G networks from companies like Huawei and ZTE.

"We need to redouble our efforts to protect our national security and interests, help our allies take vital measures for their own security, and stand firmly in defense of fundamental rights," said Representative Susan Wild, the Democratic sponsor of the measure.

The legislation would also require publicly traded companies to disclose whether they have contracted to use Huawei or ZTE or services covered under the bill. Huawei and ZTE did not immediately comment.

The bill would also mandate a report on telecommunications vulnerabilities in US embassies overseas, and direct the US State Department to identify key telecommunications infrastructure projects to promote US national security.

The Federal Communications Commission in November banned approvals of new telecommunications equipment from Huawei and ZTE, saying they pose "an unacceptable risk" to US national security.

Last year, the Chinese embassy in Washington said the FCC "abused state power and maliciously attacked Chinese telecom operators again without factual basis." Huawei has repeatedly denied allegations of wrongdoing and said the US government has "unlawfully and irrationally" targeted the company.

Washington's efforts to counter the Chinese tech giants come amid US fears that Beijing could use them to spy on Americans. Washington has for years pressured US allies not to use Huawei or ZTE equipment from 5G networks or remove gear from existing networks.

In 2019, Congress directed the FCC to order US telecoms carriers receiving federal subsidies to purge their networks of telecoms equipment posing national security risks, with promises of reimbursement.

The FCC designated Huawei and ZTE as threats, requiring US companies to remove their gear or be frozen out of an $8.3 billion (roughly Rs. 681.01 crores) government fund to purchase new equipment. However, to fund the so-called "rip and replace" effort, Congress only appropriated $1.9 billion (roughly Rs. 155 crores).

The FCC said last year companies need another $3 billion (roughly Rs. 246 crores) to remove from U.S. networks equipment made by Chinese telecoms giants Huawei and ZTE bringing the total estimated cost to $4.98 billion (roughly Rs. 408 crores). 

© Thomson Reuters 2023