US Blacklists China’s Huawei

WASHINGTON—The Commerce Department said on May 15 it was adding Huawei Technologies and 70 affiliates to its “Entity List”—a move that bans the company from acquiring components and technology from U.S. firms without government approval.

Commerce Secretary Wilbur Ross said in a statement that President Donald Trump backed the decision to “prevent American technology from being used by foreign owned entities in ways that potentially undermine U.S. national security or foreign policy interests.”

Trump earlier in the day signed an executive order barring U.S. companies from using telecommunications equipment made by firms deemed to pose a national security risk.

The executive order invokes the International Emergency Economic Powers Act, which gives the president the authority to regulate commerce in response to a national emergency that threatens the United States.

The order directs the Commerce Department, working with other government agencies, to draw up a plan for enforcement.

While the order did not specifically name any country or company, U.S. officials have previously labeled Huawei a “threat” and lobbied allies not to use Huawei network equipment in next-generation 5G networks.

In August 2018, Trump signed a bill that barred the U.S. government itself from using equipment from Huawei and another Chinese provider, ZTE Corp.

In January, U.S. prosecutors charged two Huawei units in Washington state saying they conspired to steal T-Mobile trade secrets, and also charged Huawei and its chief financial officer Meng Wanzhou with bank and wire fraud on allegations that the company violated sanctions against Iran.

Shares in Huawei suppliers in China skidded on the news as markets opened in Asia, with Luxshare Precision Industry down as much as 6.1%. Shares in smaller Chinese Huawei rival ZTE Corp also tumbled.

By David Lawder

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Author: Reuters

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