Elite US School MIT Cuts Ties With Chinese Tech Firms Huawei, ZTE

April 4, 2019 Updated: April 4, 2019

The Massachusetts Institute of Technology (MIT) has severed ties with Huawei Technologies and ZTE Corp as U.S. authorities investigate the Chinese firms for alleged sanctions violations, it said on April 3.

MIT is the latest top U.S. education institution to unplug telecom equipment made by Huawei and other Chinese companies to avoid losing federal funding.

“MIT is not accepting new engagements or renewing existing ones with Huawei and ZTE or their respective subsidiaries due to federal investigations regarding violations of sanction restrictions,” Maria Zuber, its vice president for research, said in a letter on its website.

Collaborations with China, Russia and Saudi Arabia would face additional administrative review procedures, Zuber added.

“The institute will revisit collaborations with these entities as circumstances dictate,” she said.

The move is a response to the National Defense Authorization Act (NDAA), which President Donald Trump signed into law in August 2018. A provision of that legislation bans recipients of federal funding from using telecommunications equipment, video recording services and networking components made by Huawei or ZTE. Also on the blacklist are Chinese audio-video equipment providers Hikvision, Hytera, Dahua Technology and their affiliates.

U.S. universities that fail to comply with the NDAA by August 2020 risk losing federal research grants and other government funding.

“We’re disappointed by MIT’s decision ….We trust the U.S. judicial system will ultimately reach the right conclusion,” Huawei said on Thursday.

Meanwhile, ZTE did not respond to a Reuters request for comment.

Meng Wanzhou, Huawei’s chief financial officer and daughter of its founder Ren Zhengfei, was arrested in Canada in December 2018 at the request of the United States on charges of bank and wire fraud in violation of U.S. sanctions against Iran.

Meng denies wrongdoing. She is currently out on bail in Vancouver, faces extradition proceedings in Canada.

U.S. sanctions forced ZTE to stop most business between April and July last year after Commerce Department officials had said it broke a pact and was caught illegally shipping U.S.-origin goods to Iran and North Korea. The sanctions were lifted after ZTE paid $1.4 billion in penalties.

In Beijing, the Foreign Ministry referred questions to the two companies, but said Chinese firms were required to abide by local laws.

Chinese telecoms equipment makers have also been facing mounting scrutiny, led by the United States, amid worries Beijing could use their equipment for spying. Beijing and the Chinese companies have repeatedly denied such claims.

Other Schools Drop Huawei and ZTE

The University of California at Berkeley has removed a Huawei video-conferencing system, a university official said, while the UC campus in Irvine is working to replace five pieces of Chinese-made audio-video equipment.

UC San Diego, meanwhile, has gone a step further. In August 2018, the university said that for at least six months it would not accept funding from or enter into agreements with Huawei, ZTE Corporation, and other Chinese audio-video equipment providers, according to an internal memo.

Other U.S. schools, such as the University of Wisconsin, are in the process of reviewing their suppliers.

Britain’s Oxford University stopped accepting funding from Huawei this year.

By Kanishka Singh. The Epoch Times contributed to this report.

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