U.S. tightens restrictions on Huawei access to technology and chips

Huawei did not immediately comment.

With U.S.-China relations at their worst in decades, Washington is pushing governments around to world to squeeze Huawei out, arguing it would hand over data to the Chinese government for spying. Huawei denies it spies for China.

The new actions, effective immediately, should prevent Huawei’s attempts to circumvent U.S. export controls, the Commerce Department said.

It “makes clear that we’re covering off-the-shelf designs that Huawei may be seeking to purchase from a third-party design house,” one Commerce official told Reuters.

A new rule requires companies on the economic blacklist to obtain a license when the company acts “as a purchaser, intermediate consignee, ultimate consignee, or end user.”

The department also confirmed it will not extend a temporary general license that expired Friday for users of Huawei devices and telecommunication providers. Parties must now submit license applications for transactions previously authorized.

The Commerce Department is adopting a limited permanent authorization for Huawei entities to allow “ongoing security research critical to maintaining the integrity and reliability of existing” networks and equipment.

Existing U.S. restrictions have already had a heavy impact on Huawei and its suppliers. The May restrictions do not fully go into effect until Sept. 14.

On Aug. 8, financial magazine Caixin reported Huawei will stop making its flagship Kirin chipsets next month due to U.S. pressure on suppliers.

Huawei’s HiSilicon division has relied on software from U.S. companies such as Cadence Design Systems and Synopsys to design its chips and outsourced the production to Taiwan Semiconductor Manufacturing Co., which uses equipment from U.S. companies.

TSMC has said it will not ship wafers to Huawei after Sept. 15.

Huawei CFO Meng Wanzhou was arrested in Vancouver, Canada, in 2018 and charged by U.S. officials with bank and wire fraud violating sanctions on Iran.

-Reuters contributed to this report.

Article source: https://www.cnbc.com/2020/08/17/us-to-tighten-restrictions-on-huawei-access-to-technology-chips-sources-say.html