Biden administration adds new limits on Huawei's suppliers

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
This file photo taken on October 23, 2020 shows people as they wait in line in front of Huawei's flagship store for pre-sales of the newly launched Huawei Mate40 mobile phone series in Shanghai. (AFP photo)

The administration of US President Joe Biden has further restricted companies from supplying items to China’s Huawei Technologies Co. Ltd by amending previously approved export licenses.

The move to prohibit items for use in or with 5G devices comes two weeks after the Chinese company expressed hope to hold talks with the Biden administration "separately" from Beijing to resolve issues including the US export ban on the firm.

The new changes could disrupt the current contracts with Huawei that were negotiated under previous licenses, sources familiar with the matter told Reuters.

The initial export licenses were granted by the US Commerce Department after Huawei was placed on the department’s trade blacklist in 2019.

The new rules prohibit more explicitly the export of components like semiconductors, antennas and batteries for Huawei 5G devices.

The latest actions, which show the Biden administration is reinforcing a hard line on exports to Huawei, make older licenses more consistent with tougher licensing policies implemented in the waning days of the administration of former president Donald Trump.

In January, the Trump administration said it would deny 116 licenses with face values worth $119 billion, and only approve four worth $20 million, according to a Commerce Department document reviewed by Reuters.

The Trump administration approved licenses for companies to sell $87 billion worth of goods and technology to Huawei between 2019 and 2020, the document said.

While new restrictions on those licenses badly affect some suppliers, one source noted, they also level the playing field between firms as some received licenses under less restrictive policies.

Huawei has not yet held talks with the new administration since Biden took office in January, but the company said it hopes to begin discussions soon.

Tim Danks, vice president of risk management and partner relations at Huawei Technologies USA, said late last month that "we want to have a discussion [with the US administration] separately from the Chinese government. We don't want to be lumped into that discussion."

"We think the Huawei issue is a separate issue that needs to be taken separately [from geopolitics]," Danks told Nikkei Asia.

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