As the trade war with China intensifies again, President Donald Trump is expected to sign an executive order that would make possible a ban on American companies from using telecommunications equipment from Huawei and other companies that the government believes pose a national security risk, Reuters reports.
The executive order cites the International Emergency Economics Power Act, a law enacted in 1977 that gives the President broad power to control trade in response to a national emergency. The order has been under consideration for a year, but repeatedly delayed, and may be delayed yet again, says Reuters. The Wall Street Journal first reported that the administration was considering executive actions in May 2018.
Specific companies are not named in the executive order, but it would likely affect Huawei because of longstanding concerns that the Chinese government can use its telecommunications equipment for spying. A House committee first labeled Huawei and ZTE as national security threats in 2012, accusations they have repeatedly denied. U.S. government agencies and contractors have already been banned from Huawei equipment since last year.
Huawei has come under even more scrutiny during the trade war, with Chinese officials accusing the U.S. of using Huawei as a bargaining chip. Chief financial officer Meng Wanzhou, the daughter of Huawei founder and CEO Ren Zhengfei, was arrested last year in Canada at the behest of the U.S. government and faces up to 30 years in prison on accusations of fraud. U.S. federal prosecutors have also charged Huawei with stealing trade secrets from T-Mobile.
Huawei is retaliating by suing the U.S. government, arguing that the ban on using its equipment by federal agencies and contractors violated due process and is unconstitutional.
A ban on American companies from using telecommunications equipment made by Huawei would impact wireless carriers as they prepare to launch 5G networks, in particular smaller, rural carriers that may have to spend millions of dollars to replace equipment that they have already installed.