US receives 130 licence requests to sell to Huawei despite blacklist

28 Aug 2019154 Views

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Huawei's logo. Image: Joeppoulssen/Depositphotos

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US companies are still eager to sell products to Huawei as tensions between China and the US continue to escalate.

On Wednesday (28 August), Reuters reported that the US Department of Commerce has received more than 130 applications from companies seeking licences to sell US goods to Huawei, according to sources.

This comes just two months after US president Donald Trump eased his stance on a complete blacklist, in order to allow a handful of American companies to sell goods to the Chinese telecoms giant.

Trump made this announcement after meeting Chinese leader Xi Jinping at the G20 Summit in June.

US commerce secretary Wilbur Ross announced on 10 July that Huawei would remain on the ‘entity list’, which it was added to in May. To prevent the “transfer of revenue from the US to foreign firms”, Ross said that winning licences would require companies to prove that the technology they sell to Huawei could not pose a national security risk.

In July, Ross disclosed that the commerce department had received around 50 licence applications.

Licences

According to the sources Reuters spoke to, the Trump administration is yet to grant any of these licences to companies interested in selling products to Huawei.

Amid the licence-freeze and the ongoing US-China trade war, it’s estimated that chipmakers, software companies and other businesses in Huawei’s supply chain are losing billions of dollars.

Last week, the trade war escalated further, when Trump vowed to raise tariffs on $550bn of Chinese imports to the US. This was after China imposed levies on $75bn of US goods.

During the G7 summit in Biarritz last weekend, Trump said: “I think they want to make a deal very badly. I think that was elevated last night. The vice-chairman of China came out, he said he wants to see a deal made.”

Regarding the licence situation, former commerce department official William Reinsch told Reuters: “Nobody in the executive branch knows what Trump wants and they’re all afraid to make a decision without knowing that.”

When Reuters contacted the commerce department for an official comment, a spokesperson said: “The interagency process, weighing licence requests concerning Huawei and its non-US affiliates, is currently ongoing.”

Huawei did not make any comments about the number of companies applying for licences.

Russian OS to replace Android?

While Huawei’s sales in the US suffer, along with its ability to purchase Android components, the company has begun to develop its own operating system, Harmony OS.

As TechRadar points out, the absence of key services such as Google Maps and the Google Play Store will hit the company hard when it comes to marketing its devices in the West.

As an alternative, Huawei has reportedly been investigating using the Russian-made operating system, Aurora, on 360,000 tablets that will be used to conduct Russia’s population census next year.

Aurora, Russia’s only operating system, is owned by Russia’s state telecommunications operator, Rostelecom, which is the sole contractor for buying tablets for the country’s census.

A source told Reuters: “This is a pilot project. We see it as the first stage of launching the Russian OS on Huawei devices.”

Huawei’s logo. Image: Joeppoulssen/Depositphotos

Kelly Earley is a journalist with Siliconrepublic.com

editorial@siliconrepublic.com