Why the US Restricts Chinese Technology: A Business Guide

The United States restricts certain Chinese technology mainly on national security grounds: concern that equipment, software or apps controlled by companies subject to Chinese law could enable surveillance, data access or disruption of critical networks. The restrictions are not one blanket ban. They are a set of separate laws and rules that cover specific companies, products and uses.

Key takeaways

  • Most restrictions target named companies or product classes, not all Chinese-made goods.
  • The FCC Covered List blocks new authorizations for listed telecom and surveillance equipment.
  • Federal contractors face Section 889 rules on using covered equipment anywhere in their operations.
  • Businesses should inventory cameras, routers, drones and software against these lists.

What are the main US restrictions?

MeasureWho administers itWhat it does
Covered List (Secure and Trusted Communications Networks Act of 2019)Federal Communications CommissionLists equipment and services deemed an unacceptable national security risk; listed equipment cannot receive new FCC equipment authorizations
Section 889 of the FY2019 National Defense Authorization ActFederal acquisition rules (FAR 52.204-25)Bars federal agencies from buying covered telecom and video surveillance equipment and from contracting with companies that use it
Entity ListCommerce Department, Bureau of Industry and SecurityRequires export licenses for listed foreign companies, often with a presumption of denial
Protecting Americans from Foreign Adversary Controlled Applications Act (2024)Congress, enforced through the executive branchRequired divestiture of TikTok from ByteDance control or removal from US app stores
Connected vehicle rule (finalized January 2025)Bureau of Industry and SecurityPhases in prohibitions on certain Chinese and Russian software and hardware in connected vehicles

Which companies and products are covered?

Telecom and surveillance equipment

According to the FCC, the Covered List includes telecommunications equipment from Huawei and ZTE, and video surveillance and telecommunications equipment from Hytera, Hikvision and Dahua when used for public safety, government facility security, critical infrastructure surveillance or other national security purposes. These five were added in March 2021. The list also names Kaspersky cybersecurity products (a Russian company) and the US subsidiaries of China Mobile, China Telecom and China Unicom for certain international telecommunications services.

Drones

In December 2025, the FCC added foreign-produced uncrewed aircraft systems and critical drone components to the Covered List, along with equipment from DJI and Autel Robotics. According to legal analyses of the order, the action blocks new FCC authorizations but does not prohibit continued use or sale of models authorized before the change, and the Defense and Homeland Security departments can exempt specific products found not to pose a risk.

Apps and data

Congress passed the TikTok divestiture law in April 2024, and the Supreme Court upheld it in January 2025. Enforcement was delayed by executive action while a sale was negotiated. In January 2026, TikTok completed a US joint venture in which US user data and the recommendation algorithm are secured in Oracle's US cloud under a majority-American board, with ByteDance retaining a minority stake.

Why the government says these steps are necessary

Officials have cited several recurring concerns:

  • Legal compulsion: Chinese national security and intelligence laws can require companies to assist state intelligence work.
  • Network access: Telecom equipment sits deep inside networks, where a hidden capability or forced update could be hard to detect.
  • Data collection: Cameras, drones, vehicles and popular apps collect location, video and personal data at scale.
  • Supply chain dependence: Reliance on a single foreign supplier for critical components creates strategic risk.

Chinese officials and the affected companies have disputed these claims and described the measures as protectionism. Courts and agencies have generally upheld the US actions on national security grounds.

What it means for business decision makers

Most private companies are not banned from owning previously purchased equipment, but the rules still create practical obligations:

  • Federal contractors: Section 889 requires representations about whether you use covered telecom or video surveillance equipment anywhere in your business, not only on federal contracts.
  • Telecom providers: Carriers that received federal support have been required to remove and replace covered equipment.
  • Procurement: New models from listed vendors cannot receive FCC authorization, which affects replacement parts and future purchases.
  • Security: Even where legal, unsupported or unpatched devices increase risk. Our guide on cloud security techniques covers related controls.

Checklist for IT and procurement teams:

  1. Inventory cameras, NVRs, routers, radios, drones and security software by manufacturer, including white-labeled products.
  2. Compare the inventory with the FCC Covered List and FAR 52.204-25 definitions.
  3. Ask resellers and integrators for written origin and component information.
  4. Plan replacements for covered items in sensitive locations first.
  5. Bring HR and risk teams in on employee device and app policies; see HR's role in cybersecurity.

Frequently Asked Questions

Is it illegal for a US business to use Huawei or Hikvision equipment?

For most private companies, continued use of already purchased equipment is not illegal. The FCC Covered List blocks new equipment authorizations, and Section 889 restricts federal agencies and federal contractors. If you contract with the federal government, using covered equipment anywhere in your operations can disqualify you unless a waiver or exception applies, so legal review is advisable.

Is TikTok banned in the United States?

No. A 2024 law required a divestiture or a ban, and the Supreme Court upheld it in January 2025. After enforcement delays, a US joint venture closed in January 2026 to keep the app available, with US data and the algorithm secured in Oracle's cloud. Businesses using TikTok for marketing, as in our TikTok content marketing guide, can continue.

Are all Chinese-made electronics banned?

No. US restrictions are targeted. They apply to specific companies on the Covered List or Entity List, specific product categories such as foreign-made drones and certain connected vehicle components, and specific uses such as federal procurement. Most consumer and business electronics manufactured in China remain legal to buy, though tariffs and supply chain rules may affect cost and availability.

Next steps

Assign one owner to track the FCC Covered List and BIS updates quarterly, complete a device inventory, and add a supplier origin question to your procurement checklist. Federal contractors should confirm their Section 889 representations are current.

Last reviewed: October 2026.

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