The FCC's vote to close the component-parts loophole marks the most aggressive US action against Chinese telecom hardware since 2022, threatening supply chains for carriers reliant on Huawei and ZTE components.
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FCC votes to ban Chinese hardware devices, closing 4-year loophole
The US Federal Communications Commission voted Wednesday to bar sales of devices containing key hardware components from Huawei Technologies and ZTE Corp., closing a loophole that had allowed Chinese-made parts into American networks since 2022.
"Compromised components, particularly semiconductors or communications devices, can be used to corrupt entire devices," Chris McGuire, a former White House National Security Council official under President Joe Biden, told Reuters.
The FCC maintains a list of Chinese firms whose equipment is barred from US sale over national security concerns. Since 2022, devices made by listed companies were banned from receiving new authorizations, but products containing their component parts could still gain approval. The new rules prohibit any device containing a Huawei-made logic-bearing hardware component from entering the US market.
The vote escalates Washington's decoupling from Chinese telecom infrastructure, a process that has already barred Huawei and ZTE equipment from US networks under a 2019 law. The FCC is also considering prohibiting US carriers from interconnecting with Chinese telecom firms deemed national security risks, a move that would effectively require Chinese companies to shut down US data centers and internet exchange points.
Broader Crackdown Accelerates
The ban extends beyond Huawei and ZTE. The FCC has also restricted imports of new foreign drone and router models in recent months and proposed to ban most military-grade drone imports. Last month, the agency banned equipment from a broader group of Chinese manufacturers effective July 16.
The 2019 law prohibiting the use of Huawei and ZTE equipment in US networks triggered a US$1.9 billion federal reimbursement program for rural carriers to rip and replace banned gear. Many smaller operators have cited cost overruns and supply delays, with the replacement program still incomplete as of early 2026.
Supply Chain and Competitive Fallout
US telecom carriers that rely on Chinese hardware components face potential supply disruptions and higher procurement costs as they seek alternative suppliers. The ban could benefit US-based telecom equipment competitors such as Cisco Systems and Juniper Networks, as well as non-Chinese Asian manufacturers including Samsung Electronics and Nokia.
The action comes as the Trump administration has mounted a sweeping crackdown on Chinese technology gear, mirroring similar moves by allies including the UK, which ordered the removal of Huawei equipment from its 5G networks by 2027, and Australia, which banned Huawei from its 5G rollout in 2018.
What Comes Next
The FCC is weighing additional restrictions that would bar US telecommunications carriers from interconnecting with Chinese telecom firms that own US data centers or maintain Points of Presence at internet exchange points. Such a rule would force Chinese companies to either divest those assets or cease US operations entirely. Huawei did not immediately respond to a request for comment.
FCC Chair Brendan Carr said the agency would "fully close the component part loophole," with further restrictions targeting Chinese technology in US networks still under consideration.
This article is for informational purposes only and does not constitute investment advice.
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