FCC bars US companies from using government money to buy Huawei, ZTE equipment

The Federal Communications Commission has barred U.S. companies from using its $8.5 billion-a-year Universal Service Fund to purchase equipment from Chinese telecom giants Huawei and ZTE Corp.

A further notice from the FCC proposes U.S. corporations that fall under the jurisdiction of the rule be required to "remove and replace equipment and services from covered companies." It asks for comment about how to pay for the costs associated with removing and replacing the equipment.

The FCC said additional companies could be covered by the rule in the future.

Huawei told FOX Business in a statement that the FCC’s ruling is “unlawful” because it singles out the company based on national security but provides “no evidence that Huawei poses a security threat.” The company added that the "FCC simply assumes, based on a mistaken view of Chinese law, that Huawei might come under Chinese government control."

The FCC's ruling comes just days after Huawei received a 90-day extension for its Temporary General Licenses, which allow carriers to continue service to customers in remote parts of the U.S.

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FCC Chairman Ajit Pai will join FOX Business’ “Lou Dobbs Tonight” on Friday evening.