Chinese surveillance cameras targeted by FCC for security reasons

(Bloomberg) – US regulators set to ban products from Huawei Technologies Co. and four other Chinese electronics companies, including surveillance cameras widely used by US schools but linked to oppression in western China, stepping up pressure on tech vendors suspected of being risk security guards.

Hangzhou Hikvision Digital Technology Co. and Dahua Technology Co., whose cameras are in U.S. schools and local government facilities, are included in a draft order that the Federal Communications Commission is due to vote on Thursday. Telecommunications giant ZTE Corp. and two-way radio maker Hytera Communications Corp.

The order would ban the United States from sales of company-specified telecommunications and surveillance equipment. The action begins a review period before a final vote on the issue.

In the proposal, the FCC said it could also revoke its previous authorization for corporate equipment, a move that could force schools and other U.S. customers to replace camera systems.

FCC action represents another step after “years of Huawei warnings,” said Derek Scissors, resident researcher at the American Enterprise Institute, which focuses on US economic relations with Asia . “All recent buyers of Chinese telecommunications equipment who expected years of use and now have to trade in equipment should have known better. “

In its draft order, the FCC did not specify how quickly affected gear should be removed, and asked for comment on the “appropriate and reasonable transition period.”

“This could include a transition period for non-compliant equipment,” according to the ordinance.

The FCC, Congress and the White House have pushed for Huawei and ZTE equipment not to be used in U.S. networks, citing cyber-espionage risks the companies deny. In 2018, Congress voted to prevent federal agencies from purchasing equipment from the five companies now under pressure from the FCC. Last year, the agency put companies on a list of suppliers whose products are considered a threat to national security.

“The FCC must do everything in its power within its legal authority to deal with threats to national security,” Interim President Jessica Rosenworcel, a Democrat, said in a statement last month announcing the Thursday vote. Voting begins a period of consideration and possible revision before a final vote is taken. There is no date set for this.

Congress action

Huawei, which markets phones in the United States, said in a statement that the FCC’s proposed measures were “misguided and needlessly punitive.”

Hikvision said in an email that his designation as a threat was unwarranted and that he “strongly opposes” the FCC’s measure. Dahua said he “does not and has never represented any type of threat to the national security of the United States.” He called the FCC proceedings “unwarranted.”

Hytera said its products “do not pose a threat to the national security of any country” and called the FCC’s approach inconsistent with standard US government practice to assess and mitigate risk.

President Joe Biden has continued to put pressure on China following strained relations with that country under his predecessor, Donald Trump. In recent weeks, Biden has urged his allies to confront China over alleged human rights abuses, most notably at the recent Group of Seven summit in the UK.

Congress could also intervene. The FCC would be prohibited from reviewing or issuing new equipment licenses to companies on the agency’s list of suspicious equipment or services under a bill announced on June 15 by Representative Anna Eshoo , a Democrat from California, and Representative Steve Scalise, a Republican from Louisiana.

The bill “adds an additional layer of security that prevents Chinese players from being present on the US telecommunications network,” lawmakers said in a press release.

Hikvision and Dahua have been accused by US officials of being involved in the Chinese crackdown in far western Xinjiang, where up to a million Uyghur Muslims have been held in mass detention camps. China has repeatedly denied any accusations of human rights violations against its Uyghur minority.

Still, the two companies remain the top providers of surveillance equipment in the United States and together could sell around 1 million cameras this year, according to Conor Healy, government director of the IPVM Surveillance Research Group.

“It’s still sold very widely to state and local governments,” as well as school districts, Healy said in an interview. IPVM, based in Bethlehem, Pa., Works to speak out against unethical surveillance. It derives its information from securities deposits and purchase records, Healy said.

School districts have purchased cameras in recent years in an attempt to bolster physical security after school shootings, said Keith Krueger, executive director of CoSN, the Consortium for School Networking, an association for those responsible for school technology. .

Equipment from targeted companies “is cheap and it’s good, and so people buy it,” said James Lewis, director of the strategic technologies program at the Center for Strategic & International Studies in Washington. “If you don’t know the risk, this sounds like a good deal. “

“If he is connected via the Internet and he returns to China, you would have no way of knowing if the Chinese government was examining him,” Lewis said.

Hikvision and Dahua account for about a fifth of surveillance camera sales in the United States, each ranking among the top 10 suppliers, said Jake Parker, senior director of government relations at the Security Industry Association, a trading group.

Parker called it “unprecedented” that the FCC is denying clearances for reasons unrelated to technical details or faults in applications.

The Consumer Technology Association told FCC officials that the proposed changes “could be disruptive and impose substantial burdens on manufacturers far beyond the few covered entities,” according to a filing from the technology trade association.

(Updates with the Hytera commentary in the 12th paragraph.)

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