Trump administration tightens Huawei vise
WASHINGTON » The Trump administration on Monday announced that it was restricting Huawei’s ability to buy a wider array of chips made or designed with American equipment and software, tightening the limits it has placed on the Chinese telecom giant as it looks to cripple its ability to sell smartphones and telecom gear around the world.
The rule expands on previous restrictions the United States enacted in May, which prohibited companies around the world from using American software or machines to make chips designed by Huawei. The new changes apply that rule to more semiconductors, covering any chips made abroad with American equipment.
The Commerce Department also said it was adding 38 affiliates of Huawei to a list of firms restricted from working with American companies.
“We continue to monitor the situation as we assess the potential impact,” said Rob Manfredo, a Huawei spokesman, in an email.
The move comes as tensions flare between Washington and Beijing over the United States’ actions to crack down on China’s technology sector. In recent weeks, the Trump administration’s efforts have expanded from telecom manufacturers like Huawei to consumer mobile applications. This month, it moved to curb Americans’ dealings with TikTok, the viral video app owned by Chinese company ByteDance, and WeChat, a popular Chinese messaging service.
The announcement is the latest attempt to limit the reach of Huawei, which Trump administration officials say poses a national security threat because of its ties to Beijing. U.S. officials have warned that the Chinese government could use Huawei’s networking technology to gain access to sensitive data around the world, an accusation that the company denies.
In a Monday appearance on Fox and Friends, President Donald Trump accused Huawei of spying on the United States, without presenting evidence of specific espionage, and said the U.S. would not share intelligence with other countries that use the Chinese company’s telecom gear.
“We don’t want their equipment in the United States because they spy on us,” he said. “And any country that uses it we’re not going to do anything in terms of sharing intelligence. Huawei is a disaster.”
The Commerce Department last year restricted the Chinese firm’s ability to buy chips from American suppliers, which led Huawei to try to design more of them in-house. But Huawei still needs outside manufacturers to mass-produce chips to its specifications, and those companies depend on equipment and software developed in the U.S. These were the business relationships targeted by the Commerce Department’s latest moves.
One such manufacturer for Huawei global chip juggernaut Taiwan Semiconductor Manufacturing Co. said last month that it would comply with the new U.S. restrictions and stop shipping to Huawei.
But the wording of May’s action by the Commerce Department did not appear to stop chipmakers from producing chips that would first be sent to third parties or agents who might then sell to Huawei.
The rules set in May also specifically barred companies from supplying items to Huawei that were produced to its design specifications, which seemed to allow Huawei to continue buying off-the-shelf semiconductor products that were not customized to its needs.
“There was always this complaint that the language wasn’t broad enough,” said Douglas B. Fuller, a professor at City University of Hong Kong who studies the technology industry in East Asia. The move Monday seems to be an attempt by the Commerce Department, he said, “to cover all the bases.”
The Commerce Department official did not offer specific examples of Huawei having taken steps to evade the rules issued in May, which are scheduled to go into effect in September. But the official said that the changes announced Monday were the result of conversations with third parties about the initial rules.