The Pentagon is likely to back new U.S. restrictions on China’s Huawei Technologies, reversing its earlier stance to the proposal meant to further crack down on exports to the blacklisted Chinese company, said a source briefed on the matter.
The Pentagon’s reversal is likely to make it much harder for U.S. companies to get around the U.S. exports ban on Huawei.
According to the source, U.S. Commerce Secretary Wilbur Ross had recently called on Defense Secretary Mark Esper to discuss the issue and a meeting is expected next week, with a high-level meeting scheduled to take place on February 28.
Around this date, U.S. officials are likely to discuss further technology exports to Huawei and China.
On Wednesday, the Commerce Department said, it “continuously reviews and updates export controls to address the challenges of accelerating technology diffusion and innovation” and went on to add, the “scope of the current de minimis threshold for controlled items, as well as the foreign direct product rule, to listed entities, are controls under review.”
The Department of Defense did not respond to requests for comment.
In blacklisting the company, the U.S. government had said it had a “reasonable basis to conclude that Huawei is engaged in activities that are contrary to U.S. national security or foreign policy interests.”
Huawei has repeatedly denied the accusations.
If U.S. export control rules are revised, it could lead to some lost sales by U.S. companies, opined trade lawyer Doug Jacobson while adding, “But at the end of the day it will not limit Huawei’s ability to manufacture the goods in China that they need to supply their customers”.