US ‘threatens to block all tech sales to Huawei’, say reports

US ‘threatens to block all tech sales to Huawei’, say reports

Huawei MWC.jpg

The US is threatening to block all technology exports to Huawei, potentially forcing the Chinese company to switch to semiconductors and intellectual property from non-US sources.

Numerous sources this morning, including Bloomberg, the Financial Times, and Reuters, are reporting that the US Department of Commerce (DoC) will stop granting any export licences to US companies such as Intel and Qualcomm that want to sell to Huawei.

This significant toughening of US action against Huawei comes three years after the UK identified the company as a “high risk vendor”.

Nicky Morgan, then the UK Secretary of State for Digital, Culture, Media and Sport, listed the areas from which high-risk vendors should be excluded. Though she did not mention Huawei by name, separate briefings made it clear that the government meant Huawei by this expression.

The company is banned from all safety related and safety critical networks in critical national infrastructure and security critical network functions.

A few weeks later the UK set strict limits on the amount of kit from Huawei that UK operators can use for 5G.

The US has already blocked Huawei from its fixed and mobile networks, though Capacity understands from the company that much equipment is still in place, despite a federally funded “rip and replace” programme.

Today’s reports, still unconfirmed by the DoC, say – in Reuters’ words – “US officials are creating a new formal policy of denial for shipping items to Huawei that would include items below the 5G level, including 4G items, Wifi 6 and 7, artificial intelligence, and high-performance computing and cloud items”.

Even after restrictions by the Trump administration in 2019 and 2020 the DoC in Washington continued to grant US semiconductor companies licences to sell to Huawei, so long as it was not related to 5G networks. That enabled networks already using Huawei kit to expand or replace infrastructure already supplied by the Chinese company.

Now even that is to be stopped by the Biden administration, according to today’s reports. The apparent decision comes just four weeks before the world’s industry gathers in Barcelona for this year’s Mobile World Congress (MWC).

From conversations with Capacity, Huawei is planning to be one of largest exhibitors at the event, at which the organisers are expecting 80,000 visitors. Huawei was hoping MWC would mark a return to business as usual, with the company showing off equipment and handsets to potential business customers – who will now be asking if designs have to be changed to take account of new US rules.

In briefings, Huawei is making it clear that it now focuses on trade with non-Western countries, including Africa and the Middle East. But even that trade will be hampered if US-sourced chips and intellectual property are blocked.

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