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U.S. to open program to replace Huawei equipment in U.S. networks By Reuters


© Reuters. FILE PHOTO A Huawei logo can be seen at Mobile World Congress in Shanghai (China) February 23rd, 2021. REUTERS/Aly Song/File Photo

WASHINGTON (Reuters) – The U.S. Federal Communications Commission (FCC) on Monday said it would open a $1.9 billion program to reimburse mostly rural U.S. telecom carriers for removing network equipment made by Chinese companies deemed national security threats like Huawei and ZTE Corp (HK:).

Program applications will open on Oct. 29, 2022, for those who applied after the program’s July conclusion.

In a last-year FCC designation of Huawei and ZTE, which was made in July, barred U.S. businesses from using an $8.3billion government fund for equipment purchases from them. Deciding that ZTE/Huawei equipment must be “ripped and replaced” by carriers, the FCC passed rules in December.

Rural carriers are particularly affected by the issue, as they face difficult and high-cost labor costs to replace their equipment.

FCC issued a final order that expanded reimbursement eligibility from companies serving fewer than 2 million customers to include those who serve 10 million and less customers.

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According to the FCC, it will cost $1.837billion to replace and remove Huawei and ZTE equipment.

FCC approved in June a plan that would ban equipment from U.S. telecommunications network companies belonging to Chinese firms deemed to be national security risks like Huawei or ZTE. Prior equipment permits issued to Chinese businesses could be revoked by the FCC. Five Chinese companies were identified by the FCC as being a danger to U.S. national security in March 2019. This was under an FCC law that protects U.S. communication networks.

These companies include ZTE and Huawei, Hytera Communications Corp and Hangzhou Hikvision Digital Technology Co. Zhejiang Dahua Technology Co was also affected.

The U.S. government banned federal agencies from purchasing goods and services from five Chinese firms in August 2020.

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