The US has banned five Chinese companies from supplying telecommunication products to its federal agencies. These companies include Huawei, Hikvision, ZTE Corporation, Dahua and Hytera. The government passed an interim rule regarding the ban.
Ban on Huawei Technologies
The world’s largest telecommunication network gear-maker has been accused of espionage and stealing intellectual properties by Washington. But the company has denied the charge that it has been controlled by the Chinese government or was a part of any military or intelligence unit. It has even filed a lawsuit against the US government for the restrictions on its business.
US government rule
Last year, the Trump government passed National Defense Authorisation Act (NDDA) to impose restrictions over use of federal money for purchasing telecommunication equipment from “covered” telecommunication companies. The reasons cited for the ban were national security.
The rule would come into force on August 13 and the government would accept comments on the new rule for 60 days from the date of commencement of the rule. It would come with a final version of the rule after 60 days.
Dilemma of US contractors
The contractors in the US are confused about the new rule and its scope. Also, they are uncertain about its affects on their business dealings and profit in the long run. But they are assured that they would get limited freedom to grant waiver through August 13, 2021, where security isn’t a concern.
Final draft of the rule
The final ban would come in force in August 2020. It will ban all contracts with the “covered” companies. For more information please visit our latest trending News