Breathe again until August, commerce secretary Ross tells Huawei and users

21 May 2019 | Alan Burkitt-Gray

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The US government has relaxed its embargo on Huawei until 18 August, easing the restrictions on US-based companies – including rural operators plus Google and chip maker..

The Department of Commerce (DoC) has issued a temporary general licence which sets out limited exclusions to last week’s order under which Huawei was added to the government’s entity list – forbidding US companies and people, and non-US people in the US, from trading with the company.

“The temporary general licence grants operators time to make other arrangements and the Department space to determine the appropriate long term measures for Americans and foreign telecommunications providers that currently rely on Huawei equipment for critical services,” said Secretary of Commerce Wilbur Ross (pictured). “In short, this licence will allow operations to continue for existing Huawei mobile phone users and rural broadband networks.”

Last year Huawei submitted a legal deposition saying that the US government was being “arbitrary and capricious” in its opposition to the company, and saying that it the policy would make small rural carriers uneconomic. According to Capacity’s informants, Huawei’s prices for network equipment can be 25-30% lower than prices by vendors such as Ericsson and Nokia.

The DoC said that the temporary general licence permits “certain activities necessary to the continued operations of existing networks and to support existing mobile services, including cybersecurity research critical to maintaining the integrity and reliability of existing and fully operational networks and equipment”.

That will allow not only rural carriers to continue to work with Huawei, but will permit Google to supply updates to the Android operating system used by Huawei phones – and to supply Google software such as Gmail. Over the weekend Google and chip makers indicated they would stop supplying Huawei until further notice as a result of the US embargo. 

Meanwhile company founder Ren Zhengfei told Chinese media that “there will be conflict with the United States sooner or later” over the rapidly developing trade war.

Ren, whose daughter Meng Wanzhou, Huawei’s CFO, is facing extradition from Canada to the US over charges connected with smuggling kit to Iran, said: “The current practice of US politicians underestimates our strength. Huawei’s 5G will absolutely not be affected. In terms of 5G technologies, others won’t be able to catch up with Huawei in two or three years.”