UK, US Governments Warn Against Buying ZTE Hardware

The U.S. government recently put pressure on telecommunications companies to stop buying Huawei networking equipment and consumer electronics products. ZTE, another Chinese company, now seems to be next in the line of fire of both the UK and U.S. governments.

UK Warns ISPs Against Using ZTE Hardware

Unlike Huawei, ZTE is a state-owned company, which seems to raise more questions even for the UK government, which hasn’t banned Huawei hardware yet. The UK National Cyber Security Centre (NCSC) believes that the potential national security risks are too significant to be ignored, and that it would be better if UK telcos stopped buying ZTE hardware to avoid future security problems that wouldn’t be easily mitigated.

Dr Ian Levy, Technical Director of the NCSC said:

It is entirely appropriate and part of NCSC’s duty to highlight potential risks to the UK’s national security and provide advice based on our technical expertise.

NCSC assess that the national security risks arising from the use of ZTE equipment or services within the context of the existing UK telecommunications infrastructure cannot be mitigated.

ZTE Banned From Exporting American Technology

Secretary of Commerce Wilbur L. Ross, Jr. announced that the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has blocked ZTE from exporting technology from U.S. companies.

In March 2017, ZTE settled after the U.S. government discovered that it was shipping U.S. technology to sanctioned countries such as North Korea and Iran. ZTE agreed to pay $1.19 billion and to a suspended denial of export privileges for seven years, which could be activated if ZTE’s violations continued.

The Department of Commerce has now learned that ZTE made false statements to the U.S. government during the 2016 settlement negotiations as well as the 2017 probationary period.

Secretary Ross said:

ZTE misled the Department of Commerce.  Instead of reprimanding ZTE staff and senior management, ZTE rewarded them.  This egregious behavior cannot be ignored.

The order against ZTE also means American companies can no longer sell any type of technology to ZTE to minimize the chances that ZTE would once again export that technology elsewhere.

A Bill To Ban Huawei, ZTE Hardware Is Coming

Texas Representative Mike Conaway introduced a bill this January to ban Huawei and ZTE from selling hardware to the federal government.

In a statement, Conaway said:

Chinese commercial technology is a vehicle for the Chinese government to spy on United States federal agencies, posing a severe national security threat.

Allowing Huawei, ZTE, and other related entities access to U.S. government communications would be inviting Chinese surveillance into all aspects of our lives.

The American intelligence agencies have also warned against consumers buying Huawei and ZTE devices. U.S. versions of ZTE phones were found to have a backdoor in 2012.