(Reuters) – The Biden administration has this week amended licenses for companies to sell to Huawei Technologies Co Ltd in China, further restricting companies from supplying items that can be used with 5G devices, according to sources reported.
The changes could disrupt existing contracts with Huawei that were agreed under previous licenses that have now been changed, two sources said.
The actions show that the Biden administration is strengthening the hard line of exports to Huawei, the telecommunications equipment maker blacklisted for commercial national security issues by the US.
A U.S. Department of Commerce spokeswoman declined to comment, saying the license information is subject to confidentiality. A Huawei spokeswoman declined to comment.
The initial export licenses were granted by the Commerce Department after the company was put on the department’s commercial blacklist in 2019. New conditions this week make older licenses more consistent with trade policies. tougher licenses implemented in the waning days of the Trump administration.
In January, the Trump administration decided to deny 116 licenses with a total face value of $ 119 billion and only approve four worth $ 20 million, according to a Commerce Department document reviewed by Reuters. Most of the denials fell into three broad categories: memory, headphones, and other network devices and applications.
Between 2019 and 2020, the administration approved licenses for companies to sell $ 87 billion worth of goods and technology to Huawei, according to the document. Licenses are usually good for 4 years.
While new restrictions on these licenses hurt some vendors, a source noted, they also equalize the playing field between companies, as some received licenses under less restrictive policies.
According to a revised license seen by Reuters, which went into effect on March 9, the articles cannot be used “with any 5G device or on any device,” a broad interpretation that prohibits access to a 5G device even if it is not. has nothing to do with 5G operation.
No other modified license was authorized for use in military, 5G, critical infrastructure, enterprise data centers, cloud or space applications, as of March 8th.
The notice also states that certain items must have a density of 6 gigabytes or less and other technical requirements.
Both revised licenses state that, 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 blacklisted commercially, known as the “entity list,” for issues of national security and foreign policy, and licenses to sell them typically have a probable denial standard.
But Trump took an inconsistent approach with Huawei, opening the door to more sales when he sought a trade deal, but then went down more sharply as tensions over the coronavirus and Beijing’s crackdown on Hong Kong began to rise. last year.
According to the January document seen by Reuters, some 300 applications with declared values of $ 296 billion were still pending. It is unclear how many of these have been decided.
Report by Karen Freifeld in New York; Edited by Chris Sanders, Matthew Lewis and Lincoln Feast.