Industry groups seek six-month extension in federal ban on contractors using Huawei, ZTE

By Justin Doubleday  / April 2, 2020

Two defense industry groups, citing the coronavirus outbreak, are pressing lawmakers to provide a six-month extension to the deadline for when federal contractors are banned from using Chinese telecommunications products like Huwaei and ZTE.

In a March 31 letter to leadership of the House and Senate Armed Services committees, as well as other congressional panels, the National Defense Industrial Association and the Professional Services Council ask lawmakers to delay implementation of Part B of Section 889 of the Fiscal Year 2019 National Defense Authorization Act.

"While we agree that Part B addresses a significant problem in defense supply chains, and that additional measures are needed to protect DOD information assets from covered equipment, COVID-19 has made the current implementation timeline infeasible," NDIA President Hawk Carlisle and PSC President David Berteau write in the letter.

Section 889 Part B is scheduled to go into effect Aug. 13 and bans contractors from purchasing or using IT and video surveillance services or products that contain Huawei or ZTE components.

The extension requested by the industry groups would delay the rules until February 2021.

"Postponement of the deadline will provide the government with better assurance of achieving its supply chain security objectives with the least disruption and harm to the vendor and supplier base, "the PSC and NDIA letter states. "Additionally, without the postponement, aerospace and defense companies that supply equipment or services supporting the ongoing COVID-19 pandemic would be severely impacted."

DOD has yet to publish a proposed rule for the ban. Last month, DOD officials said they had drafted a rule, but it was pending approval by the White House Office of Information and Regulatory Affairs.

Even before the COVID-19 outbreak in the United States, industry groups were questioning the scope and timeline for implementing the ban, arguing the government had not yet provided enough specifics on what kind of equipment is covered by the requirements.

"Both industry and government agencies can use the additional time to better define how to approach the objectives of Part B," NDIA and PSC's March 31 letter states.

Last summer, interim rules went into effect implementing the first part of Section 889, which banned agencies from purchasing equipment from Huawei and ZTE. The second part of the law essentially extends that ban to federal contractors.

Meanwhile, Huawei challenged the law in court last summer, but a federal judge ruled against the company earlier this year. The Chinese telecommunications giant may still appeal that ruling.