The changes could disrupt existing contracts with Huawei
that were agreed upon under previous licenses that have now been changed, two
of the sources said.
The actions show the Biden administration is reinforcing a
hard line on exports to Huawei, the telecommunications equipment maker placed
on the trade blacklist over U.S. national security concerns.
A U.S. Commerce Department spokeswoman declined to comment,
saying the licensing 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 placed on the department's trade blacklist in
2019. This week's new conditions make older licenses more consistent with
tougher licensing policies implemented in the waning days of the Trump
administration.
In 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.
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