The Trump administration announced Monday that it will further tighten restrictions on Huawei Technologies, intended to destroy its access to commercially available chips.
The actions of the US Commerce Department, first reported by Reuters, will expand in May announced restrictions aimed at preventing the Chinese telecommunications giant from obtaining semiconductors without a special license – including chips made by foreign companies that are developed or produced using American software or technology.
In a statement Monday, Secretary of State Mike Pompeo said the Department of Commerce added 38 Huawei branches to the U.S. government’s economic blacklist. That increases the total to 152 branches since Huawei was first added in May 2019.
“The Trump administration sees Huawei for what it is – an arm of the Chinese Communist Party’s (CCP) surveillance state – and we have done it,” Pompeo said in the statement. “We will not tolerate efforts by the CCP to undermine the privacy of our citizens, the intellectual property of our businesses, or the integrity of next-generation networks worldwide.”
Trade Secretary Wilbur Ross told Fox Business that the restrictions on Huawei-designed chips in May “led them to take some evasive measures. They went through third parties,” Ross said. “The new rule makes it clear that any use of U.S. software as U.S. manufacturing materials is prohibited and requires a license.”
Secretary of State Mike Pompeo said the change in the rule “will prevent Huawei from defining U.S. law through alternative chip production and provision of off-the-shelf chips.” He added in a statement “Huawei has been continually trying to evade” U.S. restrictions imposed in May.
A smartphone with the Huawei and 5G network logo can be seen on a PC motherboard in this illustration photo January 29, 2020.
Dado Ruvic | Reuters
Huawei did not immediately comment.
With US-China relations at least for decades, Washington is sending governments around the world to express Huawei, claiming it would pass data to the Chinese government for spies. Huawei denies spying for China.
The new actions, immediately effective, should prevent Huawei from trying to embrace U.S. export controls, Commerce said.
It “makes it clear that we are dealing with off-the-shelf designs that Huawei may be trying to buy from a third-party design house,” a Commerce Department official told Reuters.
A new separate rule requires companies on the economic blacklist to be licensed if a company like Huawei on the list “acts as a purchaser, interim recipient, ultimate recipient, as end user.”
The department also confirmed that it will not extend a temporary general license that expired Friday for users of Huawei devices and telecommunications providers. Parties must now submit license applications for previously authorized transactions.
The Department of Commerce assumes a limited permanent authorization for Huawei entities to “allow continuous security research critical to maintaining the integrity and reliability of existing” networks and equipment.
Existing U.S. restrictions have already had a severe impact on Huawei and its suppliers. The May restrictions will not take full effect until 14 September.
On August 8, financial magazine Caixin reported that Huawei will stop making its flagship Kirin chipsets next month due to U.S. pressure on suppliers.
Huawei’s HiSilicon division relied on software from US companies such as Cadence Design Systems Inc and Synopsys Inc to design its chips and outsourced production to Taiwan Semiconductor Manufacturing Co. (TSMC), which uses equipment from US companies.
TSMC has said it will not ship waffles to Huawei after Sept. 15.
-Reuters contributed to this report.
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