The Biden Administration Revokes Licenses for Huawei

The Biden Administration Revokes Licenses for Huawei

In a move to put more pressure on the Chinese telecoms equipment giant Huawei, the Biden administration has revoked eight licenses this year that had allowed certain companies to ship goods to the company. This action is part of the ongoing efforts to restrict Huawei’s operations and limit its growth in the US market. The Commerce Department, which oversees US export policy, has stated that these licenses were revoked in order to disrupt Huawei’s operations and limit its access to certain components.

According to a document first reported by Reuters, the Commerce Department announced the revocation of these licenses, including those for Qualcomm and Intel. The document revealed that the licenses for Huawei included the approval to ship items such as exercise equipment, office furniture, and low-technology components for consumer mass-market items like touchpad and touchscreen sensors for tablets. These items are readily available in China from various sources, both domestic and foreign.

Both Huawei and Qualcomm have not responded to requests for comments on the revoked licenses. Intel declined to provide any statement regarding the matter. The House Foreign Affairs Committee, chaired by Republican Congressman Michael McCaul, is currently reviewing the data related to the revoked licenses. These details shed light on the measures taken by the Biden administration to hinder Huawei’s operations and growth in the US market.

Despite efforts by the US government to restrict Huawei on national security grounds, the company has managed to rebound and is experiencing growth in various sectors. Last August, Huawei surprised the industry by launching a new phone powered by a sophisticated chip from Chinese chipmaker SMIC. This move, despite US export restrictions on both companies, helped spike Huawei’s smartphone sales by 64% year on year in the first six weeks of 2024.

Huawei was added to a US trade restriction list in 2019, citing concerns over potential spying on Americans. Being on this list means that Huawei’s suppliers need to obtain special licenses before shipping goods to the company. Despite the restrictions, Huawei suppliers have received licenses worth billions of dollars to sell goods and technology to the company. The Trump administration’s policy, allowing a broader range of items to be shipped to Huawei, has contributed to the company’s growth in recent years.

Between 2018 and 2023, the Commerce Department approved $335 billion worth of licenses out of a total of $880 billion in applications seeking permission to sell to Chinese parties on the entity list. The most significant approvals, amounting to $222 billion, came in 2021, during Biden’s first year in office. These figures indicate a significant amount of trade and business activities between US companies and Chinese entities on the restricted list.

The revocation of licenses for Huawei by the Biden administration reflects the ongoing efforts to curb the company’s activities in the US market. Despite challenges and restrictions, Huawei has managed to bounce back and grow its operations, especially in the smartphone and smart car component sectors. The review of license approvals highlights the complex relationship between US companies and Chinese entities on the trade restriction list, indicating a significant amount of trade and business transactions between the two parties.

Politics

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