FCC Prohibits Purchase of Huawei and ZTE Equipment with E-rate Funds

 November 25, 2019

On Friday, the FCC adopted an Order that prohibits the use of Universal Service funding, including E-rate funds, to purchase equipment and services from companies deemed a national security risk.  Initially, the two companies on the “banned” list are Huawei Technologies Company and ZTE Corp., but others may be added in the future.  Although we assume that E-rate bidding rules will allow applicants to summarily disqualify any bid that contains this equipment, I recommend that from now on, both Category 1 and Category 2 Form 470’s and/or RFPs contain the following language:

“In accordance with FCC Rules, proposals that include equipment from Huawei or ZTE, will be disqualified.”

The FCC also released an NPRM (Notice of Proposed Rulemaking) that proposes to require telecommunications carriers receiving USF funds to remove and replace existing Huawei and ZTE equipment from their network infrastructure.  This will mostly impact rural wireless carriers that have or are planning to construct new 5G cellular networks.  The Order seeks comment on the extent to which such equipment is already in place, and what the costs will be to remove and replace such equipment.  In PA, only one applicant has received E-rate funding in the last four years ($23,000) from either one of these companies and we will submit comments to the FCC on their behalf to seek funding to replace this now-prohibited equipment.

For PA applicants using the PEPPM mini-bid procurement option for FY 2020, please know that neither Huawei or ZTE are manufacturers on that contract.

— Julie

Julie Tritt Schell

Pennsylvania E-rate Coordinator
717-730-7133 – o
jtschell@comcast.net
www.e-ratepa.org