The Huawei row that has been escalating for months peaked when Washington barred the Chinese firm from buying US-made equipment, including chips, citing security concerns. A glimmer of hope appeared when Donald Trump indicated after meeting his Chinese counterpart Xi Jinping in Japan that he agreed to ease the restrictions.
US President Donald Trump’s surprise announcement that he had agreed to allow Huawei to buy products from US companies, overturning the recent ban has confused the tech industry and US officials, who are struggling to clarify this, Reuters reports.
According to the news agency, one high-ranking official in the Commerce Department’s Bureau of Industry and Security (BIS), Deputy Director of the Office of Export Enforcement John Sonderman, has instructed his agents to use the “presumption of denial” policy when it comes to license applications from US companies that plan to sell their products to Huawei. It implies a strict review, and the chances of receiving approval under it are slim to none, as Reuters points out.
In the email to staffers, cited by the outlet, he told the officials to consider the applications on merit and flag them with the notion that “This party is on the Entity List. Evaluate the associated license review policy under part 744”. This is a reference to regulations, including the licensing policy, applied to blacklisted companies. He also alerted the enforcement staff that they should further consider the Bureau’s instructions when reviewing such license applications. However, there is no information about when the Commerce Department will provide this additional guidance related to Trump’s about face.
After Trump and his Chinese counterpart Xi Jinping held their highly-anticipated talks on the sidelines of the G20 meeting in Osaka, Japan the US president took to Twitter with a series of breakthrough statements on the trade row between the two countries and the months-long Huawei spat.
“At the request of our High Tech companies, and President Xi, I agreed to allow Chinese company Huawei to buy product [sic] from them which will not impact our National Security”, he tweeted, signalling a reversal of the earlier US ban.
The move was welcomed by Huawei, with its CEO and founder Ren Zhengfei saying this was “good for American companies”.
“Huawei is also willing to continue to buy products from American companies. But we don’t see much impact on what we are currently doing. We will still focus on doing our own job right”, the company’s statement said.
Expectations of a speedy resolution to the US-China trade spat, however, were shattered by White House economic aide Larry Kudlow. He noted that President Trump’s recent decision to slightly ease the restriction by allowing to sell select components to the Chinese telecom company is “not a general amnesty” and that Huawei would remain on the so-called Entity’s List, “where there are serious export controls”.
Washington barred the Chinese firm from buying US-made equipment, including chips, about a month ago on suspicions that Huawei, the world’s largest telecom equipment manufacturer, is helping Beijing steal commercial secrets and collect personal data – allegations that both Huawei and the Chinese authorities deny. In a separate development, the Trump administration also blocked government contractors from using Huawei gear and tried to lobby the country’s allies to stop cooperating with the Chinese tech behemoth. Trump even threatened to quit sharing intelligence with London if the latter goes forward with a plan to let Huawei supply components for its high-speed broadband internet.