The US Federal Communications Commission (FCC) has officially designated Chinese telecommunications companies ZTE Corp and Huawei Technologies as threats to the country's national security. The declaration, which was made on Tuesday, essentially cuts off the Chinese companies from getting access to the country's $8.3 billion government fund meant to enhance its telecom infrastructure.
The FCC originally held a vote late last year to issue the declaration, which included an order for rural carriers to uninstall and replace any equipment made by the two Chinese companies. The 5-0 vote, in favor of the declaration, eventually led to its announcement earlier in the week.
FCC chairman, Ajit Pai, mentioned in a statement on Tuesday that the agency will not allow the Chinese Communist Party to utilize the two companies to exploit the country's network vulnerabilities. He added that allowing the companies to supply equipment and services to its networks could compromise its entire infrastructure.
While Huawei and ZTE have yet to issue an official response to the latest proclamation, both companies have vehemently denied previous accusations. Huawei, which has been the main target of the US' campaign to curb China's domination in the telecommunication industry, has repeatedly denied that it is being used by the Chinese government to spy on other countries.
FCC commissioner, Geoffrey Starks, proposed on Tuesday that the US Congress pass legislation to allocate funds for the immediate removal and replacement of the "untrustworthy equipment" supplied by the two Chinese companies.
The call follows the May 2019 executive order issued by US President Donald Trump, which barred US companies from using equipment and services from companies considered to be threats to its national security. Months after the order, both Huawei and ZTE were added to the country's trade blacklist.
In line with the order, the FCC has been increasing its efforts to bar the use of Chinese-made telecommunications equipment and services. In April, the FCC threatened to shut down the US business of three Chinese state-owned telecom companies.
The FCC stated that the companies could potentially be used to conduct espionage against the US and its citizens. China Telecom Americas, Pacific Networks Corp, and China Unicom Americas were ordered to submit letters to explain why their license to operate in the US should not be revoked. The three companies had received approvals to operate their business in the country more than a decade ago. In May, the FCC denied an application for a license to operate in the country submitted by China Mobile.