President Donald Trump recently promised to ease the ban on American companies doing business with Huawei, but the Commerce Department is requiring its staff to treat Huawei as if the blacklist is still in place, reports Reuters.
Enforcement staff were sent an internal letter this week by John Sonderman, the deputy director of the Office of Export Enforcement, to continue treating Huawei as blacklisted. The letter, viewed by Reuters, said applications from companies that want to sell to Huawei should be considered on merit and flagged with language that notes Huawei is on the entity list. The applications should also still be viewed under a “presumption of denial” policy that applies to companies on the blacklist. This means license applications are scrutinized more closely and most of them are rejected.
Along with 70 other companies, Huawei was added in May to an “entity list” of companies that U.S. companies are forbidden to do business with. As a result, many of Huawei’s most important component suppliers, including Qualcomm and Intel, severed ties with Huawei, while Google cut off its access to Android — a major headache for Huawei, which is the third-largest smartphone maker in the world. Huawei founder and CEO Ren Zhengfei said the ban would result in $30 billion in lost revenue.
According to Reuters, this is the only guidance enforcement officials have received since Trump’s surprise announcement, made after he met with Chinese premier Xi Jinping at the G20 summit. In an apparent concession to China, which sees Huawei as a major sticking point in the U.S.-China trade war, Trump suggested that the U.S. will allow American companies to resume selling hardware to Huawei as long as it doesn’t pose a “great national emergency problem,” and would hold meetings about Huawei’s trade status.
After Trump’s announcement, Ren downplayed the effect of the promised partial reprieve, telling the Financial Times that the ban has helped the company “become more united than ever.” He added “if we aren’t allowed to use U.S. components, we are very confident in our ability to use components made in China and other countries.”