The U.S. Commerce Department has withdrawn a controversial rule designed to reduce sales to China’s Huawei Technologies.
The Commerce Department in May placed Huawei on a trade blacklist, citing national security concerns. That allowed the U.S. government to restrict sales of American-made goods to the company and a small number of items made abroad that contain U.S. technology. That ruling now appears to have been reversed.
President Donald Trump’s administration plans a cabinet-level meeting this week to discuss the rule, which could be revived, killed or rewritten, amid pushback from the U.S. Treasury Department and the Defence Department that want Huawei to remain blacklisted over concerns about national security.
The United States, under current conditions, can require a license or block the export of many high-tech products shipped to China from other countries, if U.S.-made components make up more than 25% of the value. Commerce drafted a rule that would lower the threshold only on exports to Huawei to 10% and expand the purview to include non-technical goods like consumer electronics such as non-sensitive chips.
U.S. businesses have pushed back against the measure, arguing that enabling the government to regulate more sales to Huawei to include low-tech items made overseas with very little U.S. technology would end up needlessly hurting American companies while encouraging Huawei to source more goods abroad.
