Trump administration bans federal agencies from buying Huawei, ZTE tech

The Trump administration has banned U.S. federal agencies from buying equipment and obtaining services from Huawei and two other companies as part of the government's latest crackdown on Chinese technology amid national security fears.

Jacob Wood, a spokesperson for the White House's Office of Management and Budget, was quoted as saying that the administration will "fully comply" with the legislation passed by Congress as part of a defense spending bill passed last year.

CNBC first reported the spokesperson's remarks.

The new rule will take effect in a week - August 13 - and will also take aim at Chinese tech giants ZTE, Hytera, and Hikvision, amid fears that the companies could spy for the Chinese government. The rule comes in a year before Congress' mandated deadline of August 2020 for all federal contractors doing business with Huawei, ZTE, Hytera and Hikvision.

The government will grant waivers to contractors on a case-by-case basis so long as their work does not pose a national security threat.

Huawei has long claimed it does not nor can it spy for the Chinese government. Critics, including the government and many lawmakers, say the company's technology, primarily networking equipment like 5G cell stations, could put Americans' data at risk of Chinese surveillance or espionage. Huawei has vigorously denied the allegations, despite findings from the U.K. government that gave a damning assessment of the technology's security.

The company first came to focus in 2012 following a House inquiry, which labeled the company a national security threat.

Huawei spokesperson Chase Skinner said the news was "not unexpected" and that it continues to challenge the ban in court.

"The NDAA law and its implementing provisions will do nothing to ensure the protection of U.S. telecom networks and systems and rather is trade barrier based on country-of-origin, invoking punitive action without any evidence of wrong doing," he said. "Ultimately, it will be rural citizens across the U.S. that will be most negatively impacted as the networks they use for digital connectivity rely on Huawei."

ZTE did not respond to a request for comment.

Added statement from Huawei spokesperson.

New defense bill bans the U.S. government from using Huawei and ZTE tech