Biden administration adds new limits on Huawei’s suppliers

January, the Trump administration decided it would deny 116 licenses with face values totaling $119 billion, and only approve four worth $20 million, according to a Commerce Department document reviewed by Reuters. Most of those denied fell into three broad categories: memory, handset and other devices, and network applications.

Between 2019 and 2020, the administration approved licenses for companies to sell $87 billion worth of goods and technology to Huawei, the document said. Licenses are generally good for 4 years.

While new restrictions on those licenses hurt some suppliers, one source noted, they also level the playing field between companies, since some received licenses under less restrictive policies.

According to one revised license seen by Reuters, which took effect March 9th, items may not be used “with or in any 5G devices,” a broad interpretation that prohibits the item from going into a 5G device even if it has nothing to with 5G functioning.

Another amended license was not authorized for use in military, 5G, critical infrastructure, enterprise data centers, cloud or space applications, effective March 8.

The notice also says that certain items must have a density of 6 gigabytes or less, and other technical requirements.

Both revised licenses say, prior to export, Huawei or customers must implement a parts control plan and make inventory records available to the U.S. government upon request.

Companies are placed on the trade blacklist, known as the “entity list,” over national security and foreign policy concerns, and licenses to sell to them generally face a standard of likely denial.

But Trump had an inconsistent approach to Huawei, opening the door to more sales when he was seeking a trade deal but then coming down harder as tensions began rising over the coronavirus and Beijing’s crackdown in Hong Kong last year.

According to the January document seen by Reuters, some 300 applications with stated values of $296 billion were still pending. It’s not clear how many of those have been decided.

As Published by Reuters

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