U.S. TO PILE MORE MISERY ON HUAWEI

Washington, Feb, 18: The Trump administration is considering changing US regulations to allow it to block shipments of chips to Huawei Technologies from companies such as Taiwan’s TSMC, the world’s largest contract chipmaker, two sources familiar with the matter said.

New restrictions on commerce with China’s Huawei are among several options to be considered at high-level U.S. meetings this week and next. The chip proposal has been drafted but its approval is far from certain, one of the sources said.

The measure would be a blow to the world’s no. 2 smartphone maker as well as to TSMC, a major producer of chips for Huawei’s HiSilicon unit and mobile phone rivals Apple and Qualcomm. “What they’re trying to do is make sure that no chips go to Huawei that they can possibly control,” the second source said.

Huawei is at the heart of a battle for global technological dominance between the United States and China. The United States is trying to convince allies to exclude its gear from next generation 5G networks on grounds its equipment could be used by China for spying. Huawei has repeatedly denied the claim.

To target global chip sales to Huawei, US authorities would alter the Foreign Direct Product Rule, which subjects some foreign-made goods based on US technology or software to US regulations.

Reuters reported possible changes to that rule in November.

Under the draft proposal, the US government would force foreign companies that use U.S. chipmaking equipment to seek a US license before supplying Huawei — a major expansion of export control authority that could anger US allies worldwide.