Chinese telecom company Huawei says that the FCC’s efforts to block it from federal contracts and supply chains is unconstitutional, misguided, “arbitrary and capricious.”
The FCC proposal would deny money from the commission’s Universal Service Fund – which provides money to help rural and low-income areas with phone and data service – to companies using sources that are deemed threats to national security. Huawei and ZTE (also in the spotlight for sanctions violations) are on that list, on the grounds the companies could serve as vectors for Chinese hacking.
Huawei argues that the FCC is exceeding its authority and violating due process, and furthermore that the determination that it poses a threat does not have a reasonable basis.
The proposal is also opposed by NTCA–The Rural Broadband Association, which says the proposal is “overly broad and lacks clarity”, and AT&T, which worries that applying this rule only to USF recipients might distort competition and harm consumers.