Senate unanimously approves bill to ban purchase of Huawei equipment with federal funds

The Senate unanimously approved legislation on Thursday that would ban the use of federal funds to purchase telecommunications equipment from companies deemed a national security threat, such as Chinese group Huawei. 

The bipartisan Secure and Trusted Telecommunications Networks Act, which the House passed in December, bans the Federal Communications Commission (FCC) from giving funds to U.S. telecom groups to purchase equipment from companies deemed threats. 

The bill would require the FCC to establish a $1 billion fund to help smaller telecom providers to rip out and replace equipment from such companies, and to compile a list of firms seen as posing a threat to telecom networks. 

The bill is primarily sponsored by House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.), ranking member Greg Walden (R-Ore.), and Reps. Doris Matsui (D-Calif.) and Brett Guthrie (R-Ky.). 

“In today’s interconnected world, America’s wireless future depends on having networks that are secure from malicious foreign interference,” the House sponsors said in a joint statement on Thursday. “The existence of Huawei’s technology in our networks represents an immense threat to America’s national and economic security.”

“We thank our colleagues in the Senate for getting this important, bipartisan measure across the finish line and look forward to the President signing it into law,” the House sponsors added. 

Senate Commerce Committee Chairman Roger Wicker (R-Miss.), whose panel has jurisdiction over the bill, praised its passage. 

“Telecommunications equipment from certain foreign adversaries poses a significant threat to our national security, economic prosperity, and the future of U.S. leadership in advanced wireless technology,” Wicker said in a statement. “By establishing a ‘rip and replace’ program, this legislation will provide meaningful safeguards for our communications networks and more secure connections for Americans.”

The legislation, if signed into law by President Trump, would have a major effect on rural telecom providers. The Rural Wireless Association estimated in a 2018 filing to the FCC that around 25 percent of its member companies use equipment from either Huawei or Chinese group ZTE.  

A spokesperson for Huawei pointed to concerns around the impact of the legislation on telecom providers that use the company’s equipment in a statement provided to The Hill on Thursday. 

“Unfortunately, the legislation that was just passed is considerably underfunded, would take longer than anticipated and could put at risk some of our customers, who serve the most underserved areas,” the spokesperson said. “This legislation will simply reduce the ability of broadband providers to provide the most secure network equipment and in turn hurt local consumers and businesses.”

The spokesperson added that “while the intention of this bill is to provide a robust and secure network for all Americans, if implemented the legislation passed today will fall woefully short.”

The bill’s passage comes after months of bipartisan pressure to take steps against Huawei, the largest 5G equipment provider in the world. Its critics cite concerns around a 2017 Chinese intelligence law that requires Chinese companies and individuals to participate in state-backed intelligence-gathering. 

The Department of Commerce last year added Huawei to its entity list of groups that American companies are forbidden to do business with, though Huawei’s full inclusion on the list has been delayed multiple times. 

The FCC also took steps against the company in November, when it designated Huawei as a national security threat and banned telecom groups from using FCC funds to buy equipment from Huawei. 

Huawei pushed back against the FCC for these moves, announcing in December that it was suing the agency. 

The Trump administration has also made moving away from Huawei a key priority, pressuring allied companies into doing the same.

The United Kingdom made the decision earlier this year to allow the use of Huawei in peripheral 5G networks, but not more secure networks, a move that many on Capitol Hill warned could endanger intelligence sharing between the U.S. and the U.K.

-Updated at 10:50 p.m.