WASHINGTON (Reuters) – President Donald Trump is expected to sign an executive confirmation this week, preventing US companies from using telecommunications equipment made by firms that pose a national security risk, paving the way to ban business with China's Huawei, three US officials familiar with the plan, Reuters told.
FILE PHOTO: A Huawei logo is depicted during the media day of the Shanghai Auto Show in Shanghai, China, April 16, 2019. REUTERS / Aly Song / File Photo
The order, which will not specify specific countries or companies, has been under Review for more than a year, but have been repeatedly delayed, say the sources, and ask not to be named because the preparations remain confidential. It may be delayed again, they said.
The executive order will invoke the International Emergency Force Act, which authorizes the President to regulate trade in response to a national crisis threatening the United States. The order will lead the trade department, collaborate with other authorities, to prepare a plan for enforcement, the sources said.
If signed, the executive order would come at a delicate time in the relationship between China and the United States, when the world's two largest economies spread tariffs in a fight against which US officials call China's unfair trading practices.
Washington believes that equipment from Huawei Technologies Co. Ltd, the world's third largest smartphone maker, could be used by the Chinese state to spy. Huawei, who has repeatedly denied the claims, did not immediately raise.
The White House and the Commerce Department refused to comment.
The United States has actively pushed other countries not to use Huawei's equipment in the next generation 5G network as it calls "uncertainty." In August, Trump signed a bill that prevented the US government from using Huawei's equipment and another Chinese supplier, ZTE Corp..
In January, US prosecutors reported two Huawei Washington state entities who said they were involved in stealing T-Mobile US Inc business secrets, and also charged Huawei and its finance director with bank and wire fraud allegations that the company violated sanctions against Iran.
The Federal Communications Commission in April 2018 voted to propose a proposal to prevent the use of funds from a $ 9 billion state fund to purchase equipment or services from companies that pose a security risk to US communications networks.
Federal Communications Commissioner Ajit Pai said last week that he is waiting for the Trade Department to express views on "defining the list of companies" that would be prohibited under the FCC proposal.
The FCC voted unanimously to deny China Mobile Ltd's bid to deliver US telecommunications services last week and said similar preliminary approvals were being issued by China Unicom and China Telecom Corp..
The problem has taken new urgency as US wireless carriers look for partners as they roll out 5G networks.
Although the big wireless companies have already cut the ties with Huawei, small rural companies continue to rely on both Huawei and ZTE switches and other equipment because they tend to be cheaper.
The Rural Wireless Association, representing carriers with fewer than 100,000 subscribers, estimates that 25 percent of its members had Huawei or ZTE equipment on their networks, said an FCC filing in December.
On a Tuesday hearing, US senators raised the ally alarm using Chinese equipment in 5G networks.
The Wall Street Journal first reported in May 2018 that the confirmation order was reviewed. Reuters reported in December that Trump still considered issuing the order and other media reported in February that the order was imminent.
Reporting by David Shepardson, additional reporting by Chris Bing and Diane Bartz; Editing Sonya Hepinstall