President Trump Expected To Ban U.S. Telecoms From Using Huawei Products

The United States and People’s Republic of China have been engaged in a trade war for the last few years. The US is reportedly about to take this battle to the next level. President Trump will likely sign an executive order this week that would prohibit telecommunications companies from using equipment from companies such as Huawei.

Three anonymous officials insisted that an upcoming executive order would ban telecommunications providers from using products from other companies that have been deemed a threat to national security. It is no secret that the United States believes that Chinese telecommunications company Huawei is a threat. The Central Intelligence Agency (CIA) recently confirmed that Huawei is directly funded by the Chinese government.

huawei logo

According to the International Emergency Economic Powers Act, the president is able to regulate commerce if there is an unusual threat to national security. In this scenario, the president can only declare an emergency in response to a threat that originates outside of the United States. The act was originally passed in the 1970's and was expanded after 9/11. The executive order would invoke this act and call upon the Department of Commerce to enforce it. Many believe that companies like Huawei pose a cybersecurity threat. 

Huawei has been accused of spying on behalf of the Chinese government. Most recently, the Department of Justice also accused Huawei of stealing trade secrets from T-Mobile, committing wire fraud, and obstructing justice. Huawei is not the only Chinese telecommunications company to come under fire. ZTE illegally sold American goods to Iran and North Korea. The US has been actively trying to ban their products and have even tried to persuade other countries to stop trading with Huawei and ZTE.

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Department of Commerce, Herbert C. Hoover Building- Image from US Federal Government

Huawei has denied all of the allegations and believe that the US government is trying to limit the economic reach of Chinese companies. One Huawei representative remarked, “We urge the United States to stop using the excuse of security issues to unreasonably suppress Chinese companies, and provide a fair, just, non-discriminatory environment for Chinese companies carrying out normal investments and operations in the United States.”

Interestingly, the Federal Communications Commission (FCC) recently voted to not purchase items from companies that may be a threat to American communication systems. FCC Chairman Ajit Pai noted that they were waiting for the Department of Commerce to “define the list of companies” that would be banned. The upcoming executive proposal is expected to provide clarification.

The US is not the only country that has considered banning Huawei and ZTE products. Australia and New Zealand have already banned various Chinese telecommunication items. It remains to be seen what impact the anticipated executive order will have on the international economy.