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U.S. hits Chinese telecom giant Huawei with new tech restrictions as tensions with Beijing escalate

The Commerce Department issued new rules that will prevent Huawei from using any U.S. produced or designed technology

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Huawei production campus in Dongguan, China
Huawei production campus in Dongguan, China
(Kevin Frayer / Getty Images)
Updated: May 15, 2020 - 2:55pm

The Commerce Department on Friday issues new rules that will prevent Chinese telecom giant Huawei and its suppliers from using American technology and software. The move will almost certainly escalate tensions between Washington and Beijing, which have already flared significantly during the pandemic.

U.S. companies will still be allowed to apply for licenses to supply products and designs to Huawei, but for the most part, American companies will no longer be permitted to sell U.S. designed or manufactured chips to Huawei.

This administration has identified Huawei as a threat to national security, repeatedly cautioning Americans not to trust its machinery, as it may be used by the Chinese government for spying.

These news rules are the most recent amplification of restrictions against Huawei. In the past year, the government barred exports of American products to the Chinese telecom company and 114 of its affiliate brands.

Huawei has been taking steps to reduce its dependence on American chip manufacturers. But even without direct American exports, the company still relies on foreign manufacturers that, in turn, rely on technology developed in the U.S.

"There has been a very highly technical loophole through which Huawei has been able, in effect, to use U.S. technology with foreign fab producers,” Commerce Secrertary Wilbur Ross said on Friday. 

The new rules are an attempt to seal up that loophole.

The State Department has said that it has broad and far-reaching concerns about Huawei, including its work developing a Chinese government surveillance network in China and abroad.

Sen. Ben Sasse (R-Nebraska) said on Friday that the new rules were “long overdue.”

“The United States needs to strangle Huawei," he said. "Modern wars are fought with semiconductors, and we were letting Huawei use our American designs."

State-controlled Chinese newspaper the Global Times ran a message on Friday responding to Commerce’s new rules by warning that China will active an “unreliable entity list,” which will restrict Chinese involvement with U.S. companies like Qualcomm, Cisco, and Apple, and halt completely the purchase of Boeing airplanes.

President Trump has repeatedly blamed China for its role in the global coronavirus pandemic. He has accused the Chinese government of not doing enough to stop the spread of the coronavirus or accurately inform the rest of the global population about its effects.