Washington suspends licenses allowing US companies to export to Huawei

Washington suspends licenses allowing US companies to export to Huawei

The Biden administration has stopped providing US companies with export licenses to Huawei as it prepares to impose a total ban on the sale of US technology to the Chinese telecommunications equipment giant.

Several people familiar with the discussions within the administration said the Commerce Department had notified some companies that it would no longer license any group wishing to export US technology to Huawei.

The move marks the latest installment in Washington’s campaign to rein in the Shenzhen-based tech firm, which US security officials say helps China engage in espionage. Huawei denies any involvement in spying.

The Trump administration in 2019 imposed severe restrictions on the export of US technology to Huawei by adding the group to a blacklist called the “Entity List”. The move was part of a strategy to crack down on Chinese companies that Washington said posed a national security risk to the United States.

But the Commerce Department continued to grant export licenses to some companies, including Qualcomm and Intel, to supply Huawei with technology that was unrelated to high-speed 5G telecommunications networks.

Over the past two years, President Joe Biden has taken an even tougher stance on China than Donald Trump, especially in the area of ‚Äč‚Äčadvanced technology. In October, he imposed sweeping restrictions on the supply of advanced semiconductors and chipmaking equipment to Chinese groups.

Alan Estevez, chief of the Commerce Department’s Bureau of Industry and Security, led a China-related policy review aimed at determining what additional steps the administration should take to make it more difficult for the Chinese army to use US technology to develop weapons.

Among the officials examining China policy are Thea Kendler, a former prosecutor involved in a U.S. criminal case against Meng Wanzhou, Huawei’s chief financial officer. Meng was detained in Canada for three years following a request from Washington, but later struck a deal with US prosecutors that allowed her to return to China.

In December, the Biden administration placed several dozen other Chinese companies on the Entity List, including Yangtze Memory Technologies (YMTC), a flash memory company that has become a Chinese national champion.

Last year, the Financial Times reported that the Biden administration was investigating allegations that YMTC violated US export controls by supplying Huawei with chips containing US technology for its most advanced smartphones.

Capitol Hill Republicans, led by Michael McCaul, who recently became head of the House Foreign Affairs Committee, have called on the Biden administration to stop providing export licenses to Huawei.

Martijn Rasser, a technology expert at CNAS, a think tank, said the latest move was a “really big decision”. He said Huawei had diversified into new areas, such as undersea cable development and cloud computing, in recent years, raising new national security concerns.

“The Commerce Department’s actions are partly driven by the fact that Huawei as a company is a very different animal than it was four years ago when it was focused on 5G,” said Rasser, a former CIA official.

The development comes as Secretary of State Antony Blinken prepares to travel to China next week in the first visit to the country by a member of Biden’s cabinet.

The latest Huawei decision comes as the United States steps up efforts with its allies to slow China’s efforts to develop cutting-edge technologies such as semiconductors that are used for everything from artificial intelligence and nuclear weapons modeling to hypersonic weapons development.

Washington last week struck a deal with Japan and the Netherlands that would see US allies impose restrictions on companies in their countries to prevent them from exporting certain chipmaking equipment to China. In October, the United States imposed unilateral restrictions on American companies to prevent them from exporting semiconductor manufacturing tools.

Late last year, Estevez suggested the United States was looking at a number of other areas. Asked about reports that the administration was considering restrictions on quantum and biotech, he told the CNAS think tank: “If I was a bettor, I’d put money on it.”

A formal decision on whether to implement a total ban on the export of US technology chips to China has yet to be made.

The Commerce Department declined to comment on the licensing halt, but said the agency, along with other government departments, would “continually evaluate our policies and regulations and communicate regularly with external stakeholders.” Huawei declined to comment.

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