FCC Closes the 'Component Loophole': Devices With Huawei or ZTE Logic Chips Now Barred From US Market

As of October 13, 2026, the Federal Communications Commission's Third Report and Order, FCC 26-50, is officially in force.

Any radio-frequency device that incorporates a chip, wireless module, or programmable sub-assembly produced by an entity on the FCC's Covered List can no longer receive the equipment authorization it needs to enter the United States market.

The Covered List currently includes Huawei Technologies and ZTE Corporation, alongside Hytera, Hikvision, Dahua, DJI, and Autel.

The rule closes what FCC Chairman Brendan Carr has called the "component part loophole" — a structural gap that allowed Covered List silicon to slip into US-bound products as long as the final assembler was not itself a covered entity.

The order introduces a new defined term: a logic-bearing hardware component. It covers any physical component that either generates and uses timing signals exceeding 9,000 pulses per second using digital techniques, or uses radio frequency energy for data processing such as computation, storage, retrieval, or transfer.

In practical terms, that sweeps in baseband processors, Wi-Fi and cellular chipsets, Bluetooth modules, trust platform modules, cryptographic elements, IoT modules, optical transceivers, and system-on-a-chip designs. Passive components such as housings, resistors, capacitors, and power-only elements are explicitly excluded.

Determining whether a component was "produced by" a Covered List entity uses a totality-of-circumstances test. Buying a chip through a distributor or a non-covered reseller does not end the inquiry: the FCC examines who designed the logic, who holds the intellectual property, and who controls the fabrication process.

Repackaging or relabeling does not escape the bar.

The rule runs forward only. Devices that already hold FCC authorization are unaffected, and applications that were pending as of October 13 are grandfathered under the old rules.

But the grandfathering carries a sharp edge: the moment an applicant amends a pending filing to add, substitute, or change a logic-bearing hardware component, the filing is treated as a new application and becomes subject to the full Covered List bar.

There is no exception for involuntary substitutions driven by supply disruptions or component shortages.

Certification bodies — the private Telecommunications Certification Bodies that handle most consumer device approvals — must now include a component-provenance review in their process.

Meanwhile, companion marketplace rules will require platforms to display FCC authorization IDs at the point of sale, with Tier 1 sellers compliant by March 1, 2027 and third-party marketplaces by June 1, 2027.

Industry groups have warned about compliance costs: the Commercial Drone Alliance says replacing restricted components will force manufacturers to source substitutes at higher prices, raising costs through the supply chain.

The companion rulemaking remains open and could go further, with proposals for mandatory hardware bills of materials and an eventual extension of the bar to software and firmware.

For the first time, FCC equipment authorization — once a radio-frequency technical compliance program — has become a de facto import control operating at the silicon layer. A chip bearing Huawei's or ZTE's intellectual property, embedded inside a product sold under any brand, is now enough to block that product from the US market entirely.