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HUAWEI and ZTE may face new US ban via White House executive order

The White House may declare a "national emergency" by banning U.S. companies from using teleco parts from HUAWEI and ZTE.

Published onDecember 27, 2018

ZTE logo from IFA 2018.

The attacks by the U.S. government on China-based Huawei and ZTE may about to enter a new phase. Bloomberg reports, via unnamed sources, that the White House is preparing an executive order that could result in U.S. companies being banned from using telecommunications equipment from HUAWEI and ZTE.

Specifically, the executive order would allegedly order the U.S. Commerce Department to bar U.S. companies from using parts and equipment from companies that the government believes could pose a national security risk. The order, which reportedly has not been finalized, would use the government’s International Emergency Economic Powers Act as its foundation, which allows the White House to regulate and control commerce in the event of a national emergency.

Neither HUAWEI nor ZTE have been named in drafts of this order, according to the story. However, it is expected that when it is released, the Commerce Department will use it as the excuse to ban the use of products by those two companies in the U.S. Bloomberg points out that a number of rural wireless carriers in the U.S. use parts from HUAWEI and ZTE, due to their lower prices.

The HUAWEI logo.

The U.S. government has been claiming for years that HUAWEI and ZTE are linked to the Chinese government and that their smartphones and other products could be used to spy on citizens and companies in this country. HUAWEI and ZTE have both repeatedly denied these allegations.

In 2018, ZTE was banned from using U.S. parts in its products for seven years, including its smartphones, because the company had broken the terms of its deal not to violate the current U.S. Iranian trade embargo. It looked like ZTE was going to shut down. However, thanks to the intervention of President Donald Trump, the ZTE parts ban was lifted, allowing the company to stay in business.

HUAWEI was supposed to start selling its smartphones in the U.S. with an agreement from AT&T, but U.S. lawmakers convinced the carrier to back out of that deal at the last minute in January 2018. Earlier in December, Canadian law enforcement authorities arrested Meng Wanzhou, HUAWEI’s chief financial officer, at the request of the U.S. She was accused of also violating the country’s trade embargo of Iran. She is currently out on bail and awaiting an extradition trial, where she may be brought to the U.S.