Huawei's 90-day reprieve expires today, so what now?

Wednesday, 21 Aug, 2019

The Commerce Department is giving Chinese technology giant Huawei another 90 days to buy from American suppliers, Wilbur Ross told FOX business on Monday.

On Sunday, President Trump said he would rather not do business with the Chinese company for national security concerns. Ltd.to buy components from USA companies to supply existing customers, the Commerce Department said on Monday, but it also moved to add more than 40 of Huawei's units to its economic blacklist.

In an interview Monday, Ross said some companies require more time to purge the remaining need for Huawei products.

The extended limited reprieve applies to technology sales and transfers necessary for "the continued operations of existing networks and to support existing mobile services, including cybersecurity research", Commerce said in an updated order Monday.

In the same announcement, the US Department of Commerce has also stated that it has identified 46 more subsidiaries of Huawei that will be added to the Entity List.

The U.S. Commerce Department of Commerce has confirmed that Huawei will be given an extra 90 days before being added to its Commerce Entity List.

"The decision is politically motivated and has nothing to do with national security".

The reprieve came after the Department of Commerce put Huawei and its 68 affiliates on an Entity List in May, which would restrict the sale or transfer of US technologies to Huawei. It's increasingly looking like the U.S. isn't half as bothered about this stuff as it makes out and is merely using the entity list as a negotiating chip in its broader geo-political spat with China. However, the company was restricted from placing new orders for parts and components from the United States firms to build new devices without seeking license approvals.

The U.S, has never provided any proof of these claims, and Huawei argues the ban is politically motivated and created to give the Trump administration more leverage in its ongoing trade war with China.

But he expressed confidence in Huawei's full-year results and said it needs to "spend the money and solve the production continuity issue" by ramping up strategic investment on things including production equipment.

For Huawei's smartphone customers, the impact is not likely to take effect for some time, as the company has already obtained access to the next major version of Android.

Shares of US chip makers that sell to Huawei rose, including those of Qualcomm Inc., Intel Corp. and Micron Technology Inc. The U.S. action against Huawei is driven by political factors and violates fair market rules, the company said.

The commitments Geng referred to were made when Trump and his Chinese counterpart Xi Jinping agreed to a new truce in the ongoing trade war between their countries during the recent G20 summit in June. It called on the USA government to remove it from the list.

Huawei is China's biggest phone maker, and sales to the company account for a significant portion of revenues for some U.S. suppliers.