President Trump on Wednesday signed an executive order to bar U.S. companies from using telecommunications firms deemed a national security risk, a move targeted at both present and future liabilities but one that is poised to affect China's Huawei Tech.
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In a statement from the White House it was noted that "The President has made it clear that this Administration will do what it takes to keep America safe and prosperous, and to protect America from foreign adversaries who are actively and increasingly creating and exploiting vulnerabilities in information and communications technology infrastructure and services in the United States..."
The action will direct the Commerce Department, in consultation with other federal agencies, to craft an enforcement strategy.
This Executive Order declares a national emergency with respect to the threats against information and communications technology and services in the United States and delegates authority to the Secretary of Commerce to prohibit transactions posing an unacceptable risk to the national security of the United States or the security and safety of United States persons.
It comes amid increasing scrutiny of Chinese telecom firms. The Federal Communications Commission recently voted to deny China Mobile access to the U.S. market and the Justice Department in January charged Huawei with the theft of U.S. trade secrets, along with allegations of bank fraud and violations of Iran sanctions.
The long-awaited action also comes as countries around the world prepare for the launch of fifth generation wireless technology, which promises broadband speeds without a hard-wired connection.
The Trump administration has been pressuring foreign governments to ban Huawei from the pending networks amid allegations that the firm acts as a conduit for Chinese espionage and is closely tied to the communist government, claims the company has denied.
Some countries, including Australia, have taken steps to block Huawei from the 5G networks, but the United Kingdom and others reportedly plan to still allow the firm to participate.
Alongside Trump's efforts, Congress previously banned government agencies from using equipment from Huawei, prompting the firm to sue the federal government.
Huawei rose to prominence by offering cheaper products than competitors, which critics say is possible only through subsidies and other financial incentives from the Chinese government.
The main U.S. wireless carriers have vowed not to use Huawei equipment in their 5G networks, but rural providers have relied on the company's low-cost equipment and warned of the potential impact of a ban.