An FCC proposal is under consideration that would prohibit companies, including Dahua, that are on the US Government’s Covered Entity List from receiving FCC authorizations for future products. Dahua submitted comments on the record that point out the following:

We believe the FCC does not have the legal authority to make decisions about authorizations based on considerations other than how devices might impact the integrity of the U.S. telecommunications system through RF interference. In this case, the proposed rule is clearly about geo-political and national security issues. But the law does not empower the FCC to take such considerations into account when it comes to equipment authorization.

The proposed rule is “arbitrary and capricious” because they seek to deny authorizations based simply on the identity of the company, rather than on any technical considerations relevant to protections against RF interference. There is no evidence that Dahua’s equipment causes excessive RF interference or fails to meet any other technical standard considered in the equipment authorization process. In fact, all Dahua’s products sold in the United States have been certified through the Supplier’s Declaration of Conformity (“SDoC”) procedures by FCC-authorized labs or through FCC’s certification procedures, to the extent applicable.

The FCC’s proposed rules would be unconstitutionally retroactive if they seek to revoke existing authorizations based on non-technical criteria. These rules would conflict with the U.S. Constitution by violating protected property rights and penalizing companies without any type of hearing.

The costs of enforcing the rules would vastly exceed any speculative benefit. The vast majority of Dahua’s equipment is not connected to public communications networks and therefore, is not relevant to FCC’s concerns regarding national security risks to communications networks. Limiting Dahua’s access to the US will result in huge losses. These losses would stem from the potential need to replace existing systems, the inability to upgrade their current systems, and from the decrease of security products supply, diminishment of competition in the U.S. security market, and higher prices for security products ultimately paid by end-users. These losses would far outweigh any potential benefit.