Menu
US prepares to ink federal contract ban on companies using Huawei

US prepares to ink federal contract ban on companies using Huawei

Regulation will also bar four other Chinese companies

Credit: Huawei

The Trump administration plans to finalise regulations this week that will bar the US. government from buying goods or services from any company that uses products from five Chinese companies including Huawei, Hikvision and Dahua, a US official said.

The rule, which was prompted by a 2019 law, could have far-ranging implications for companies that sell goods and services to the US government since they will now need to certify they do not use products from Dahua or Hikvision, even though both are among the top sellers of surveillance equipment and cameras worldwide.

The same goes for two-way radios from Hytera Communications and telecommunications equipment or mobile devices like smartphones from Huawei Technologies or ZTE.

Any company that uses equipment or services in their day-to-day operations from these five companies will no longer be able to sell to the US government without obtaining a US government waiver.

The White House action comes amid increasing US-China tension over the handling of the novel coronavirus, China's actions in the former British colony of Hong Kong and a nearly two-year trade war.

"The danger our nation faces from foreign adversaries like China looking to infiltrate our systems is great," said Russ Vought, acting director of the White House Office of Management and Budget in a statement to Reuters.

"The Trump Administration is keeping our government strong against nefarious networks like Huawei by fully implementing the ban on Federal procurement."

Huawei did not have an immediate comment. Dahua, ZTE, Hikvision and Hytera could not immediately be reached for comment.

The US government annually awards more than US$500 billion in contracts, according to the Government Accountability Office.

The rule from the Federal Acquisition Regulatory Council will take effect on August 13.

While there was previously uncertainty in the contracting community surrounding the implementation and enforcement of the rule, given its potential impact on contractors, the White House is making clear it will not be delayed and waivers could be difficult to get.

While it is unclear if this will have an impact on current contracts, it could complicate future contracts.

Amazon.com, for example, received 1,500 cameras to take temperatures of workers during the coronavirus pandemic from Zhejiang Dahua Technology Co Ltd in April.

Amazon's cloud unit is a major contractor with the US intelligence community, and it has been battling Microsoft for an up to US$10 billion cloud computing deal with the Pentagon.

The official said the administration will require agencies to conduct a national security analysis before they grant any waivers, something Congress did not expressly require in the statute.

The official added that the rule is aimed at more than just barring government agencies from using products from Huawei and other named Chinese firms, but is a bid to limit their influence, saying it essentially gives companies a choice: do business with the US government or with the Chinese firms.

It is the latest effort by Washington to isolate the Chinese firms.

Last year, the United States placed Huawei, Hikvision and other firms on its economic blacklist, barring the firms from buying components from U.S. companies without U.S. government approval.

On June 30, the Federal Communications Commission formally designated Huawei and ZTE Corp as posing threats to US national security, a declaration that bars US firms from tapping an US$8.3 billion government fund to purchase equipment from the companies.

(Reporting by David Shepardson in Washington; Additional reporting by Chris Sanders in Washington; Editing by Robert Birsel and Matthew Lewis)


Follow Us

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags HuaweiZTEhikvisionDahua TechnologyHytera

Events

Featured

Slideshows

Meet the Reseller News 30 Under 30 Tech Awards 2020 winners

Meet the Reseller News 30 Under 30 Tech Awards 2020 winners

This year’s Reseller News 30 Under 30 Tech Awards were held as an integral part of the first entirely virtual Emerging Leaders​ forum, an annual event dedicated to identifying, educating and showcasing the New Zealand technology market’s rising stars. The 30 Under 30 Tech Awards 2020 recognised the outstanding achievements and business excellence of 30 talented individuals​, across both young leaders and those just starting out. In this slideshow, Reseller News honours this year's winners and captures their thoughts about how their ideas of leadership have changed over time.​

Meet the Reseller News 30 Under 30 Tech Awards 2020 winners
Reseller News Exchange Auckland: Beyond the myths — how partners can master cloud security

Reseller News Exchange Auckland: Beyond the myths — how partners can master cloud security

This exclusive Reseller News Exchange event in Auckland explored the challenges facing the partner community on the cloud security frontier, as well as market trends, customer priorities and how the channel can capitalise on the opportunities available. In association with Arrow, Bitdefender, Exclusive Networks, Fortinet and Palo Alto Networks. Photos by Gino Demeer.

Reseller News Exchange Auckland: Beyond the myths — how partners can master cloud security
Reseller News welcomes industry figures at 2020 Hall of Fame lunch

Reseller News welcomes industry figures at 2020 Hall of Fame lunch

Reseller News welcomed 2019 inductees - Leanne Buer, Ross Jenkins and Terry Dunn - to the fourth running of the Reseller News Hall of Fame lunch, held at the French Cafe in Auckland. The inductees discussed the changing face of the IT channel ecosystem in New Zealand and what it means to be a Reseller News Hall of Fame inductee. Photos by Gino Demeer.

Reseller News welcomes industry figures at 2020 Hall of Fame lunch
Show Comments