The United States Department of Commerce announced on Friday more export controls on chips destined for the Chinese company Huawei.

Huawei is positioning itself as a global leader in 5G, the next generation of wireless communications.

However, according to the U.S. government, Huawei faces increasing international scrutiny as some countries reconsider their relationship with the company over national security concerns raised by its close ties to the Chinese government.

Huawei has been largely blocked from the U.S. telecommunications equipment market due to concerns that the company may build back doors on its products to provide the Chinese government with access to U.S. networks.

At the same time, in the context is also a 2017 Chinese intelligence law requiring companies and citizens to disclose confidential data and information to the government if requested.

Export control

The amendment released this Friday by the Commerce Department to the direct foreign products rule will make high-tech chips destined for Huawei subject to the requirements of the United States’ export control license.

That export control will occur if the chips are produced with equipment controlled by the United States or if the design of the chip is of American origin.

«Despite the actions of the Entity List that the Department took last year, Huawei and its foreign affiliates have intensified their efforts to undermine these national security-based restrictions through an indigenization effort. However, that effort still depends on United States technologies, «Commerce Secretary Wilbur Ross said Friday.

«This is not how a responsible global corporate citizen behaves,» he added. «We must amend our rules exploited by Huawei and HiSilicon and prevent the technologies of the United States. Allow malicious activities contrary to the interests of national security and foreign policy of the United States.»

The purpose of export control is to inhibit Huawei’s ability to use American technology to make chips.

Circumstances surrounding the case

In May 2019, the United States Bureau of Industry and Security (BIS) added the Chinese manufacturer of telecommunications equipment and devices Huawei to the Entity List.

Although it has repeatedly extended a temporary general waiver that allows many U.S. companies to continue doing business with Huawei, in March 2020 BIS asked for comments on whether it should continue to extend the license.

In 2019, BIS also added to the List of Entities a number of academic firms and institutions that support the People’s Liberation Army’s ability to develop supercomputers, as well as companies involved in supplying surveillance technologies used in mass detention and racial profiling of Uighurs, a predominantly Muslim minority in northwest China’s Xinjiang Province.