U.S. Could Grant Temporary Exemptions for Huawei Blacklist

Officials said Monday they would grant a handful of temporary exceptions to an export blacklist against Huawei, providing some suppliers and customers of China’s telecom giant a 90-day reprieve from tough trade penalties, the Wall Street Journal writes.

In an order scheduled to be published on Wednesday, the Commerce Department said it would grant a temporary license for U.S. exports to Huawei and dozens of its affiliates. Washington issued the blacklist order last week on grounds that Huawei was a national security threat.

The latest move comes hours after Google unit signaled it would cut access to some of its most-popular features on new Huawei smartphones.  The reprieve for Huawei eases tensions between Washington and Beijing as both countries seek to get trade talks back on track. Shutting off Huawei’s access to U.S. components without exceptions would be a devastating blow to the company.

According to the Journal, the reprieve also could help the U.S. as it seeks to persuade allies around the world to ban Huawei gear from their networks, by limiting the immediate global disruptions from the U.S. blacklist.

The effect of the new license is to create relatively narrow but significant exceptions to last week’s tough export ban, allowing U.S. suppliers to begin figuring out how to move forward under the export ban, without unduly disrupting their contracts, or existing networks.

“The Temporary General License grants operators time to make other arrangements and the Department space to determine the appropriate long term measures for Americans and foreign telecommunications providers that currently rely on Huawei equipment for critical services,” said Secretary of Commerce Wilbur Ross. “In short, this license will allow operations to continue for existing Huawei mobile phone users and rural broadband networks.”

Last week’s blacklist order said that U.S. firms generally could no longer export chips or other technology to Huawei, unless they obtained an individual license from Washington, and few were expected to be granted.

One beneficiary of the new temporary license appears to be rural wireless carriers in the U.S., many of which still use Huawei equipment. They had worried that the blacklist could hurt their operations by limiting their ability even to communicate with Huawei about their networks.

But the scope of the exceptions isn’t limited to rural carriers and applies to other networks that depend on Huawei gear. The exceptions also cover support to existing Huawei handsets that were available to the public on or before May 16, the day the blacklist became effective.

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