Huawei isn’t accepting the FCC’s move to bar it from a $8.5 billion a year fund.

Óscar Gutiérrez/CNET

Huawei is reportedly getting ready to take the Federal Communications Commission (FCC) to court over its decision to bar US carriers from using its $8.5 billion a year Universal Service Fund to buy equipment from the embattled Chinese telecom. It’ll challenge the FCC in the Fifth Circuit Court of Appeals in New Orleans next week, the Wall Street Journal reported Thursday.

Last Friday, the FCC voted to exclude Huawei and ZTE from the fund, which subsidizes US broadband deployment and services, because they allegedly pose a national security threat. Its order sets up a process for barring more companies, but the two Chinese telecoms are currently the only ones on the list.

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The order also pushes carriers that get USF funds to replace any Huawei or ZTE gear they already have in place, with FCC Chairman Ajit Pai also proposing a reimbursement program to help out with this.

Huawei is expected to announce the suit at its Shenzhen headquarters next week, according to the Journal. It didn’t immediately respond to a request for comment from CNET.

The US has long alleged that Huawei and ZTE maintain tight relationships with the Chinese government, creating fear that equipment from these manufacturers could be used to spy on other countries and companies. The Commerce Department blacklisted Huawei following a May executive order from President Donald Trump that effectively banned the company from US communications networks. Huawei and ZTE deny that their gear can be used for spying.

First published at 3:12 a.m. PT.
Updated at 3:53 a.m. PT: Adds more detail.

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