FCC May Punish US Carriers That Make Deals With China’s Huge Huawei, Says Report

Eric Lieberman | Associate Editor

The Federal Communications Commission is reportedly mulling over a new rule that would attempt to limit the amount of technology in the U.S. coming from a powerful Chinese corporation.

The U.S. government has been vamping up pressure against Huawei, the country’s largest telecommunications equipment company, both directly, and indirectly by trying to influence American firms. Punishing domestic-based companies for doing business with Huawei, a prospect first reported by The Wall Street Journal, could be yet another added element.

The federal agency is considering reducing substantial subsidies for carriers that employ Huawei products, among other potential measures, according to the WSJ.

Both U.S. lawmakers and top military officials warned against Chinese-made cell phones because of likely foreign surveillance during a Senate Intelligence Committee hearing in February.

“We’re deeply concerned about the risks of allowing any company or entity that is beholden to foreign governments that don’t share our values to gain positions of power inside our telecommunications networks,” FBI Director Christopher Wray testified at the time, according to CNBC. “That provides the capacity to exert pressure or control over our telecommunications infrastructure. It provides the capacity to maliciously modify or steal information. And it provides the capacity to conduct undetected espionage.”

Not long before, Congress advised that AT&T sever ties with Huawei, or any similar telecommunication company in China, because it would then harm its ability to do business with the U.S. government. A 2012 investigative report from the House Permanent Select Committee on Intelligence enumerated deep-seated suspicions of Huawei, and China’s ZTE Corp.

Huawei — along with other companies in the country — constantly denies that it operates at the behest of the often paternalistic Chinese government. Those promises of commercial independence haven’t assuaged many concerns in America, as a testy relationship between the foreign adversaries seems to be gradually heating up over time. (RELATED: Huawei Exec Detained On Bribery Suspicions)

President Donald Trump, for example, has also imposed several tariffs recently, many of which are directed at China, triggering concerns of a trade war ensuing.

The potential actions from the FCC could mark further assertive initiatives from the federal government, which is trying to make America the first country with a 5G infrastructure. (RELATED: The Race To 5G Technology: How America Could Lose Out On The Next Biggest Thing)

Both the FCC, as well as the U.S. private sector, and Chinese companies like Huawei are pushing full steam ahead in creating an advanced technological ecosystem. Some analysts, though, are declaring China the early leader.

The FCC declined to comment on the report that it is considering new measures in this respect.

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