Law Banning Telecommunications Products from Five Chinese Manufacturers to Take Effect this August

ACEC News / Advocacy

February 14, 2020

Law Banning Telecommunications Products from Five Chinese Manufacturers to Take Effect this August

By Dan Hilton

Section. 889 of the John S. McCain National Defense Authorization Act for FY 2019, would ban the government receipt and/or use of telecommunication products manufactured by five Chinese companies and their subsidiaries.

Specifically, section 889(a)(1)(B) prohibits executive agencies, including DoD, from entering into a contract (or extending or renewing a contract) with an entity that uses any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system. “Covered telecommunications equipment” means any telecommunications equipment produced by Huawei Technologies Company, ZTE Corporation, Hytera, Hikvision, or Dahua (or any subsidiary or affiliate of such entities).

The ban will take effect in two stages, with stage one already underway. Stage one prohibits the government from obtaining products from the five companies. Stage two bans contracting with any entity that uses telecommunications equipment or services produced by the five companies. It will go into effect in August and has a direct impact on A/E firms.

As GSA stated in its briefing to the Federal Agencies and Procurement Advocacy Committee, “No matter what your company makes or sells, come August 13, 2020, any technology your company uses must be checked to ensure that it does not include banned components.” In the extreme, use of roaming telephone services could be a violation (e.g. England and Canada are allowing Huawei to develop their 5G systems).

Some of the challenges committee members raised were that the government does not currently have, nor does it intend to produce, a so-called blacklist of products and services prohibited from use. Firms will also be challenged to identify the physical presence and use of this equipment or these services in all of their and their subcontractors’ offices, including remote and overseas offices, when submitting offerors.

A draft rule is expected to be released this spring, which will provide the public the opportunity to comment on its implementation and impact on the private sector.

Dan Hilton is ACEC Director Procurement Advocacy and International Affairs.

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