US government agencies are now officially banned from purchasing or using certain telecommunications and surveillance products from Chinese tech companies like ZTE and Huawei.
Yesterday, President Donald Trump signed the John S. McCain National Defense Authorization Act into law. Along with allocating $716 billion in defense funding, the bill put restrictions on government use of products manufactured by a number of China-based technology firms.
The prohibitions on these tech companies, such as ZTE and Huawei which are specifically mentioned by name in the bill, cover any “substantial or essential component of any system, or as critical technology as part of any system.” These products included in the ban cover a range of technology from smartphones to networking devices.
Other Chinese tech companies singled out in the bill include a number of video surveillance manufacturers such as Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, and Dahua Technology Company.
Lawmakers along with U.S. intelligence officials had long warned of national security issues with Huawei and ZTE. Pressure from U.S. politicians had previously ended a AT&T – Hauwei deal that was in the works to bring their products stateside.
Earlier this year, ZTE, the U.S.’s fourth largest smartphone manufacturer, halted its operations in the country. Its business was almost ended for good when the company faced fines and hit with a 7-year supplier ban after misleading the U.S. government about violating U.S. sanctions with Iran and North Korea. However, seemingly out of the blue, President Trump stepped in and his administration worked out a deal with ZTE to lift the ban and get the company back up and running in the U.S.
Politicians criticized this move by the Trump administration to effectively bail ZTE out. Congress added a bipartisan provision to the NDAA bill to reinstate the overall ban on ZTE, but Republicans, urged on by the White House, had removed it from the final version of the bill that Trump signed. As it stands, ZTE is not banned in the United States, but their products are prohibited from governmental agency use.