U.S. companies have been banned by the Federal Communications Commission (FCC) from using federal funds to purchase equipment from Chinese telecom giants Huawei and ZTE.
The FCC announced the ban on Nov. 22, not long after the discovery of Huawei wireless gear near a U.S. nuclear missile base in Montana.
FCC Commissioner Brendan Carr said that he had recently visited Malmstrom Air Force Base, home to 150 Minuteman III nuclear missiles.
“Set against that destructive power is a completely serene and wide-open landscape,” Carr said. “It is just wheat fields and big sky country. Except, as it turns out, there are cell towers all around the Montana missile fields running on Huawei equipment.”
The FCC’s new ruling prohibits American telecommunications companies from using money from the Universal Service Fund to purchase equipment from foreign companies that pose a threat to U.S. security. The Universal Service Fund is an $8 billion pot of funds used to subsidize rural telecommunications networks.
“The measure effectively bans rural carriers reliant on federal subsidies from buying new Chinese equipment or maintaining existing foreign equipment,” security correspondent Bill Gertz wrote for The Washington Times on Nov. 22.
FCC Chairman Ajit Pai said the action followed reports from both the Trump administration and Congress warning that Chinese equipment contains “backdoor” remote access that could permit China’s military or intelligence services to spy or disrupt critical service.
Huawei and ZTE were the first two companies designated as national security threats.
“Both companies have close ties to China’s communist government and military apparatus,” Pai said during an open meeting on the rule.