Multiple reports say that the Biden administration is considering putting stricter export control rules that would make it impossible for the Chinese telecom company Huawei to buy any U.S.-made technology parts.
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| White House is considering a ban on Huawei's use to US Technology |
The Economic Times was the first publication to say that the Department of Commerce has told several U.S. companies to no longer give licenses to export American-made tech to Huawei.
This move comes when tensions between the United States and China are at an all-time high. Disputes over the position of Taiwan, which controls the majority of the global semiconductor industry, are expected to boil up around the middle of 2022.
In 2019, the United States added Huawei and ZTE to the "entity list" maintained by the Department of Commerce. This effectively blocks the two companies access to cutting-edge technology produced in the United States. This move was made in response to long-standing concerns that the two companies pose risks to national security. The addition of a company to the entity list is seen as being on a blocklist; nevertheless, the laws permit the Department of Commerce to award export permits to listed firms after investigating the proposed transaction. According to the Financial Times, Intel and Qualcomm received rights to sell less advanced technology to Huawei, which the Shenzhen-based business integrated into smartphones and personal computers. These technologies were sold to Huawei under the terms of the licenses.
According to The Wall Street Journal, the limitations made it impossible for Huawei to acquire the more sophisticated technology that the company would need to manufacture handsets compatible with 5G networks.
The world's biggest maker of telecommunications equipment, Huawei, maintains that there is no threat to national security posed by the technology it sells.
An Escalation of Tensions
As the geopolitical struggle between the United States and China heats up, Vice President Joe Biden has ordered further limitations on selling goods to Chinese manufacturers and other organizations.
According to Matt Sheehan, a researcher at the Carnegie Endowment for International Peace, these actions included blocking access by Chinese entities to sophisticated semiconductors and chipmaking equipment.
According to the information provided by Sheehan, "the limitations demand a difficult-to-get permission for the selling of advanced semiconductors to businesses inside China, therefore essentially denying the nation of the computational power it needs to train machine learning at scale." "The regulations also expand limitations on chipmaking equipment even farther to companies that support the semiconductors supply chain, shutting out both the talent that is found in the United States as well as the components that are found in the tools that are used to create the chips."
The White House hasn't said anything about the possible move to a total ban on giving Chinese companies advanced U.S. chips or technology for making semiconductors.
A spokesperson for the U.S. Commerce Department told the BBC,We maintain frequent contact with external stakeholders and conduct regular policy and regulatory reviews in close collaboration with our interagency export control colleagues at the Depts of Energy, Defense, and State.
Last week, the White House said that officials from the Netherlands and Japan were in Washington to talk. They talked about supply chain security and ideas to stop China from accessing advanced semiconductors technology. A plan like this could stop Beijing from making the semiconductors it wants to make at home.
On Friday, Dutch Prime Minister Mark Rutte informed reporters in The Hague that any prospective deal was unlikely to be made public. Rutte made this statement in reference to a recent meeting between the two parties.
Officials from the United States have similarly refrained from making any explicit remarks. The Deputy Secretary of Commerce, Don Graves, said to the press, "We can't comment about the agreement right now."
The Rollout of 5G Networks
At the same time that the United States government has been working to obstruct Beijing's access to cutting-edge technology, it has also been working to eradicate the use of China telecom equipment by American carriers, both large and small. This is a time-consuming and expensive process (see: FCC Faces $3 Billion Funding gap in Huawei Rip-and-Replace Program), but it is being done simultaneously with the former effort.
The Secure Equipment Act was passed by the Senate and signed into law by Vice President Joe Biden in November 2021. This legislation prevents the Federal Communications Commission from authorizing any license that uses technology constructed by five Chinese manufacturers if it threatens the nation's security. Because of this, Huawei cannot provide the United States with equipment for 5G networks.
In addition to close allies and Five Eyes cooperating with the United Kingdom, Canada, and Australia, telecommunications companies in the United States have been effectively barred from using new technology from the likes of Huawei and ZTE, not least as a portion of their 5G networks. This ban applies to the United States, the United Kingdom, Canada, and Australia.
Although no nation in the EU has barred Chinese companies from its telecommunications networks, several European countries, in addition to New Zealand, which is also a member of Five Eyes, have decided not to utilize equipment manufactured in China as part of their national rollouts of 5G.
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