Key Takeaways:
The FCC is moving to close a loophole that allows smartphones and other devices containing components from blacklisted Chinese firms to be sold in the US, while the Trump administration separately drafts a ban on Chinese-made solar inverters.
The Federal Communications Commission plans to vote next month on a measure barring US sales of devices containing components from Huawei and other blacklisted firms, closing a loophole that currently permits smartphones with HiSilicon chips to reach American consumers. The FCC maintains a list of companies whose equipment is barred from US sale over national security concerns, but no regulations currently prohibit American sales of electronics containing chips designed by Huawei's chip unit HiSilicon.
"Compromised components, particularly semiconductors or communications devices, can be used to corrupt entire devices," said Chris McGuire, a former White House National Security Council official under President Joe Biden. Since the FCC already banned Huawei on national security grounds, "it is only logical for it to also ban devices that include Huawei components."
The proposed rule would close that gap, the FCC said in a statement, and "protect Americans from electronic devices that have been determined to pose unacceptable risks to the national security of the United States." Huawei did not immediately respond to a request for comment.
Separately, the Trump administration is drafting a ban on imports of foreign inverters — devices that connect solar panels and batteries to the grid — over concerns China could use them to disrupt power supplies, according to five people familiar with the matter. The FCC-led inverter rule would apply to new foreign models and could be published as early as this year. The European Commission in May banned Chinese-made inverters from publicly funded energy projects, spurring the US to revive its own effort, the sources said.
China is the world's largest maker of inverters, led by Sungrow Power Supply and Huawei, and has been expanding its Western market share by driving down prices. Last year, Reuters reported that US experts who strip down grid-connected equipment had found rogue communication devices not listed in product documents inside some Chinese solar inverters. "Europe and America are waking up to the risk of losing sovereign control over their power systems through inverters," said Uri Sadot, chief executive officer of energy security firm SolarDefend.
The twin actions represent Washington's latest push to tighten technology restrictions on China after a period of relative detente. Beijing's use of export controls on rare earth minerals last year prompted the Trump administration to take a softer stance during the president's first term, but the FCC has since imposed bans on new foreign models of drones and routers. Those bans, imposed in December and March respectively, allow companies to apply for waivers to access the US market with new equipment — though none have so far been granted to Chinese firms. The FCC emphasized those bans were "entirely country neutral and did not target any country in particular."
The US Department of Defense is already barred from procuring solar photovoltaic cells, modules or inverters manufactured by a foreign entity of concern, which would include Chinese companies, under the National Defense Authorization Act for fiscal year 2026. In Europe, policymakers are considering further plans to tighten security around inverters, including by designating risky suppliers under the updated Cybersecurity Act.
Heather Conley, a Europe expert at the American Enterprise Institute in Washington, said the measures could signal more US-European alignment on China, after the Group of Seven leaders agreed this month to work together to cut their reliance on China for critical minerals. The Chinese Embassy in Washington said it "firmly opposes the overstretching of the concept of national security and its unjustified suppression of Chinese companies," adding that the US should provide "a fair, just and non-discriminatory environment" for Chinese businesses.
This article is for informational purposes only and does not constitute investment advice.
