The Federal Communications Commission said it will move ahead with proposals to ban telecommunications giants from using Huawei and ZTE networking equipment, which the agency says poses a "national security threat."
The two-part proposal revealed Monday would first bar telecoms giants from using funds it receives from the FCC's Universal Service Fund, used by the agency to subsidize service to low-income households, from buying equipment from the Chinese telecom equipment makers.
The second proposal would mandate certain telecom giants remove any banned equipment they may have already installed.
In a statement, the FCC said it would offer a reimbursement program to help carriers transition to "more trusted" suppliers.
"We need to make sure our networks won’t harm our national security, threaten our economic security or undermine our values," said Republican-appointed FCC chairman Ajit Pai in remarks. "The Chinese government has shown repeatedly that it is willing to go to extraordinary lengths to do just that."
On a background call with reporters, the FCC did not say how much of the Universal Service Fund has been used to purchase equipment from could-be banned companies, but noted that "a number" of smaller rural wireless carriers have used the fund to buy Huawei equipment.
The FCC said Huawei and ZTE were already on the list of companies that pose a threat, but that the draft order would "establish a process for designating other suppliers that pose a national security threat," potentially opening the door for new additions.
It's the latest move by the government to crack down on technology providers seen as a potential homeland security threat. Chief among the fears are that Huawei and ZTE are subject to Chinese laws, and could be told to secretly comply with demands from Chinese intelligence services, which could put Americans’ data at risk of surveillance or espionage.
The claims first arose in 2012 following a House inquiry, which labeled the company a national security threat.
Earlier this year, the Trump administration banned federal agencies from buying equipment from Huawei and ZTE, as well as Hytera and Hikvision.
Both Huawei and ZTE have long denied the allegations.
Chairman Pai said in an op-ed in The Wall Street Journal: "When it comes to 5G and America’s security, we can't afford to take a risk and hope for the best. We need to make sure our networks won’t harm our national security, threaten our economic security or undermine our values."
Democratic commissioner Jessica Rosenworcel said in a statement: “The FCC is moving forward after more than a year and a half with its proposal to ensure that our universal service fund, which supports deployment in rural areas, will not be used to purchase insecure network equipment. But we need cybersecurity policies that target all our network providers—not just our universal service recipients."
"In addition, we need to be mindful that in a global economy, our networks will still connect to insecure equipment abroad. So we should start researching how we can build networks that can withstand connection to equipment vulnerabilities around the world, including virtualizing the radio access part of our networks," said Rosenworcel.
The FCC's proposals are expected to be voted on during a meeting on November 19.