Security Camera Compliance with the 2019 National Defense Authorization Act (NDAA) & Hikvision / Dahua Sanctions
Security Camera Compliance with the 2019 National Defense Authorization Act (NDAA) & Hikvision / Dahua Sanctions
On Aug 1, 2018, the US government passed a resolution, effective Aug 1, 2019, to prevent the federal government, and anyone else who is involved with national security, from making purchases of telecommunications and surveillance cameras originally manufactured in five specific factories in China. The ban affects some or all Honeywell, Hikvision, Dahua, Lorex, Swann, LTS, Annke, Alibi, Laview, WBox, Interlogix, Flir, Bosch, ICRealtime, QSee, Panasonic, ADT, Indigo Vision, Montavue, and many more security products.
What companies are banned by the NDAA?
The ban was part of the 2019 National Defense Authorization Act (NDAA) and specifically bans security cameras by Hikvision, Dahua, and their OEMs. NDAA also requires all federal government and "critical infrastructure" to remove any product that originated in a Hikvision or Dahua factory before Aug 1, 2019. The NDAA also bans ZTE, Huawei, and Hytera telecommunication equipment, but not surveillance equipment, for use both in the federal government and for use in 5G cellular infrastructure.
Hikvision and Dahua and their OEMs are Sanctioned
On Oct 7, 2019, the US government also placed sanctions on Hikvision and Dahua for human rights abuses. Again, some or all Honeywell, Hikvision, Dahua, Lorex, Swann, LTS, Annke, Alibi, Laview, WBox, Interlogix, Flir, Bosch, ICRealtime, QSee, Panasonic, ADT, Indigo Vision, Montavue, and many more security products are included.
What these sanctions do
These sanctions prevent these companies from using US technology or standards in future software or firmware releases and from using US patents in future hardware models. This means that they are going to face a situation where they either don't update firmware for cybersecurity concerns or lose ONVIF compliance or features when their firmware is updated. For these reasons, we recommend staying away from these brands.
Who is affected by the ban?
The NDAA ban affects federal projects only. The sanctions affect everyone. Vermont has also banned these products for state government purchases. Many other states have discussed also following with bans for state-level purchasing. Some local governments have passed laws requiring that they follow the same rules and regulations as the NDAA. However, SCW has no way of monitoring those local laws.
Why were Hikvision and Dahua banned for federal government use?
The NDAA, itself, did not provide an explanation for the ban.
Congressional testimony of those who voted for the ban centered around these ideas:
1. Believing that the Chinese government could use these manufacturers in mass espionage.
2. A lack of cybersecurity safeguards (This has been a major problem in our industry, especially after the 2017-2018 major hacks of Dahua (Lorex) cameras, please see our Best Practices to prevent IOT Security Camera Hacks for a list of what happened and advice on how to harden your security camera system's cybersecurity).
3. Concerns about the contracts awarded to these two companies in relation to the humanitarian crisis and mass imprisonment of the Uyghur people (Hikvision and Dahua received large military contracts for monitoring the Uyghur people).
4. The belief that this would bring manufacturing back to the US.
What's the result of the federal use ban?
The firms banned were the major manufacturers of most security cameras. The ban is currently upending the security industry with a large number of providers selling these systems at or below cost because of oversupply of product that is now banned for federal uses and facing human rights sanctions. There is also some fear in the industry that the Magnitsky Act sanctions could be used to seize products or prevent the import of products by these companies.
Ironically, this mass sell-off is currently making it more difficult for American companies to compete. There has been significant disruption to the marketplace with some US companies selling entire divisions, posting massive Q4 losses, or going under completely. (Arlo posted a 100M loss in Q4, and Interlogix, previously a part of GE, went bankrupt, for example)
Could Hikvision and Dahua product be blocked from import?
Yes, that is a possibility, but not according to the law already passed. However, a new law is already being discussed by the US House Committee on Foreign Affairs.
On 3/4/19, additional Magnitsky Act sanctions on Hikvision and Dahua were proposed because of their part in the Uyghur “re-education camps”. Magnitsky Act sanctions can result in the US government seizing equipment and assets, imposing fines and penalties, revoking licenses, or blocking the import of products, among other things.
This letter also discussed imposing financial penalties on American companies that do business with Hikvision and Dahua.
On Oct 7, 2019, these companies were sanctioned for human rights abuses and put on the "entity list." The US government entity list is a listing of companies that cannot use US technology (without an exception) and which US companies who imported Hikvision and Dahua equipment would be put on a watch list.
The significance of this development is difficult to overstate. ADI, for example, holds about half a million dollars of Hikvision equipment. The possibility that they look to dump this product is high, especially if it looks likely that this product may get seized by the government or sanctions imposed for carrying it.
It is especially important that consumers remain informed. We expect some security camera providers to go out of business this year and be unable to honor their warranties. Purchasing equipment that may be sanctioned or seized may mean that you won't be able to buy compatible cameras in the future.
New Rules Incoming
On May 15th, 2019, President Trump signed an executive order directing the Secretary of Commerce to draft rules, within 150 days, banning US companies from doing business with "foreign adversary technology."
On Aug 9th, 2019, the US government released new proposed interim rules for the administration of the NDAA. Of particular note, this update included in the ban "substantial or essential components" which is defined as "any component necessary for the proper function or performance of a piece of equipment, system, or service" of "covered telecommunications equipment or services."
The law then defines its terms:
“Covered telecommunications equipment or services,” as defined in the statute, means—
• Telecommunications equipment produced by Huawei Technologies Company or ZTE Corporation (or any subsidiary or affiliate of such entities);
• For the purpose of public safety, security of Government facilities, physical security surveillance of critical infrastructure, and other national security purposes, video surveillance and telecommunications equipment produced by Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, or Dahua Technology Company (or any subsidiary or affiliate of such entities);
This definition seems to ban Huawei for telecommunications but not surveillance. It also seems to only ban Hikvision or Dahua for "public safety, security of Government facilities, physical security surveillance of critical infrastructure" projects. For example, if you are a government entity using cameras to track wildlife outdoors, you may be exempt from the Hikvision/Dahua ban. Consult your agency for clarification.
One reason why Huawei is mentioned for telecommunication, but not surveillance, is that Huawei HiSilicon SOC chips are in 90% of all surveillance cameras and NVRs. The only provider, who we know of, that doesn't carry any devices that use Huawei components is Avigilon. Even Axis has a line that uses Hisilicon SOCs.
Here at SCW, our reading of the law is that Huawei HiSilicon SOCs are not banned for use in surveillance, but are banned for telecommunications. This view is supported by the Security Industry Association's report on the NDAA.
Nevertheless, we understand that opinions may differ about the law. We always want our customers to be able to make an informed decision with all available information, so will be taking steps to clearly identify which SCW camera models have Hisilicon DSP chips and include that information in our spec sheets. Also, we will be switching to another chip manufacturer (MStar Semiconductor, Inc out of Taiwan) for our equipment over the coming year because of the lack of clarity from the United States Government on using Huawei components in surveillance cameras. (Update: some of the MSTAR products have arrived including the Warrior 8.0 v2 4K Fixed Lens Bullet Camera and the Deputy 8.0 v2 4K Fixed Lens Dome Camera).
This is a developing situation and we will attempt to keep this page updated, to the best of our ability.
Has SCW ever done business with Hikvision or Dahua?
Yes, we have done business with both. They are the largest providers of surveillance cameras in the world and a vast majority of cameras are traced back to their factories. We stopped using Dahua in 2014. We switched from using Hikvision in 2017.
We still carry some limited supply as to not strand past customers but clearly label them as "not for federal use." As much as we are able, we are attempting to reduce the risk that we might provide you with equipment that could be banned or seized.
What's the future look like for SCW?
We switched from Dahua/Hikvision several years ago when we became aware of some of these issues before these concerns were really in the congressional record. Unlike buying Dahua or Hikvision equipment, you don't have a risk that we're going to go out of business and not honor our warranties or that you won't be able to buy compatible cameras in the future.
We also believe in providing secure products, which is one reason our newest line has cloud-based firmware upgrades and why we have a software team building our own, secure camera viewing and management applications. If you have any cybersecurity concerns, we would love to hear from you.
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Our NDAA Compliant Camera and NVR Models
The Detective 8.0 - 26DV8M-A - 8MP (4x1080P) Multi-Purpose Lens Turret Dome Camera with Motorized Zoom and Focus and Audio MicrophoneIn stockSpecial Price $466.65 Regular Price $549.00
The Viking 8.0 - 26BV8M-A - 8MP (4x1080P) Multi-Purpose Lens Bullet Camera with Motorized Zoom and FocusIn stockSpecial Price $439.20 Regular Price $549.00
The Admiral Pro 16 Channel 4K NVR v2 - ADMP16P16-V2MIn stockSpecial Price $639.20 Regular Price $799.00
The Admiral Standard 16 Channel 4K NVR v2 - ADM16P16-V2MIn stockSpecial Price $519.20 Regular Price $649.00
The Sheriff 8.0 - 26DF8M-IK10 - 4K (8MP = 4x1080P) Vandal Proof Fixed Wide Angle Lens IK10 Dome CameraIn stockSpecial Price $212.50 Regular Price $250.00
The Deputy 8.0 v2 - 26DF8M - 4K (8MP = 4x1080P) Fixed Wide Angle Lens Turret Dome CameraIn stockSpecial Price $212.50 Regular Price $250.00
The Deputy 4.0 v2 - 26DF4M - 4MP (2x1080P) Fixed Wide Angle Lens Turret Dome CameraIn stockSpecial Price $170.00 Regular Price $200.00
The Deputy 2.0 v2 - 26DF2M - 2MP (1080P) Fixed Wide Angle Lens Turret Dome CameraIn stockSpecial Price $127.50 Regular Price $150.00
The Warrior 8.0 v2 - 26BF8M - 4K (8MP = 4x1080P) Fixed Lens Mini Bullet CameraIn stockSpecial Price $212.50 Regular Price $250.00
The Warrior 4.0 v2 - 26BF4M - 4MP (2x1080P) Fixed Lens Mini Bullet CameraIn stockSpecial Price $170.00 Regular Price $200.00
The Warrior 2.0 v2 - 26BF2M - 1080P 2MP Fixed Lens Mini Bullet CameraIn stockSpecial Price $127.50 Regular Price $150.00