Court of Appeal upholds FCC subsidy ban for Huawei purchases | Economic news


NEW ORLEANS (AP) – A federal appeals court on Friday refused to hear a request from Chinese tech giant Huawei to remove a rule used to ban rural telephone operators on national security grounds from using telephones. government funds to buy his equipment.

The 5th Circuit Court of Appeal ruled that the Federal Communications Commission was fully within its power and jurisdiction to issue the rule prohibiting recipients of grants from the “Universal Service Fund” from purchasing equipment or services from third parties. companies considered to pose risks to national security.

The three-judge panel also rejected an allegation by Huawei Technologies Ltd that the FCC did not have the expertise to designate the company’s equipment as a security risk to the US telecommunications infrastructure.

“The assessment of security risks to telecommunications networks is the responsibility of the FCC’s wheelhouse,” the judges wrote in a 60-page notice, dismissing any suggestion that this was some sort of agency. junior-varsity ”on national security issues.

Huawei did not immediately offer a response to the decision.

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The Trump administration has imposed a series of sanctions on Huawei, saying it cannot be trusted not to spy for Beijing because Chinese law requires it. Huawei says it is not government owned and denies it could facilitate Chinese espionage.

Huawei sued the FCC in late 2019 after the agency voted to ban rural carriers from using government subsidies to buy equipment from Huawei or its Chinese rival, ZTE Corp. At the time, the company called the decision “based on politics, not security.” He claimed that the FCC was overstepping its authority in making judgments on national security.

Friday’s decision followed a long tradition of U.S. courts not to challenge government judgments on national security.

Huawei’s sales in the United States fell after a congressional panel warned in 2012 that the company and ZTE were security risks and asked operators to avoid them. In May 2019, the Trump administration tightened the noose by blocking access to U.S. technology and components, including semiconductors and Google’s popular mobile services.

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