Huawei allowed buying US components to maintain existing networks

The U.S. government on Monday temporarily reduced some restrictions imposed last week on Huawei in order to minimize disruption for the telecom company’s customers around the world.
Huawei phone campaign in China
The U.S. Commerce Department will allow Huawei Technologies to purchase American-made components in order to maintain existing networks and provide software updates to existing Huawei smartphones.

However, the China-based technology company is still prohibited from buying American parts and components to manufacture new products without license approvals, Reuters reported.

The development will assist telecom operator customers of Huawei across the globe to source telecom network maintaining services from Huawei.

Spain’s Telefonica said it is reviewing a U.S. order which hit Chinese telecoms giant Huawei with severe sanctions, to see if it will affect its customers, a spokeswoman for the group said on Monday.

The German Economy Ministry is examining the impact of U.S. sanctions against Huawei Technologies on German firms, a spokeswoman said.

Globe Telecom said it has received assurance from Huawei that the company will continue to provide security updates and after sales services to its device users using the Globe network. “We wish to assure our customers that the current situation at Huawei will not impact its network services,” Globe Telecom said.

The new authorization is intended to give telecommunications providers that rely on the Huawei equipment time to make other arrangements, U.S. Secretary of Commerce Wilbur Ross said in a statement.

The authorization, which is in effect for 90 days, suggests changes to Huawei’s supply chain may have immediate, far-reaching and unintended consequences for its customers.

“The goal seems to be to prevent internet, computer and cell phone systems from crashing,” said Washington lawyer Kevin Wolf, a former Commerce Department official.

Huawei is the world’s largest telecommunications equipment maker and the second largest smartphone maker.

The Commerce Department said it will evaluate whether to extend the exemptions beyond 90 days.

On Thursday, the U.S. Commerce Department added Huawei and 68 entities to an export blacklist that makes it nearly impossible for the Chinese company to purchase goods made in the United States.

The companies on the list are deemed to be engaged in activities contrary to the national security or foreign policy interests of the United States.

The license also allows disclosures of security vulnerabilities and for Huawei to engage in the development of standards for future 5G networks.

Huawei purchased components worth $70 billion in 2018 including $11 billion from U.S. firms including Qualcomm, Intel and Micron Technology. The recent development started impacting several technology companies in the U.S. as well.