US ban on China tech giant faces uncertainty a month out

Concerns among U.S. lawmakers over Chinese telecom giant Huawei remain heightened one month out from a deadline by the Trump administration for American companies to stop doing business with the firm, with questions lingering about the timing of the ban itself.

The Commerce Department added the firm to a prohibited “entity list” in May before issuing temporary extensions through mid-August. Those were renewed again until Nov. 19, with Saturday marking the one-month deadline for companies to cut off business with the firm.

The Trump administration has urged companies to stop doing business with the telecom giant due to concerns that it may pose a threat to U.S. national security, while the exact timing of the ban has also been complicated by ongoing U.S. trade negotiations with China.

Sen. Ron Wyden (D-Ore.), a leading member of Congress on tech issues and a member of the Senate Intelligence Committee, told reporters on Thursday that “this is a time to be very tough with respect to holding the line on Huawei.”{mosads}

Sen. Mark Warner (Va.), the top Democrat on the Intelligence panel, told The Hill that he did not “have a lot of confidence that the president understands the implications, that this should not be part of a trade discussion.”

Warner referenced efforts by the State Department and other agencies to convince allied nations to cut Huawei out of their networks and asked, “How would we have credibility to go back on any other technology issue?” if President Trump were to “trade away” Huawei. 

Concerns around Huawei largely stem from an intelligence law the country adopted in 2017 that requires all Chinese companies to “assist and cooperate with the state intelligence work,” meaning data from American companies using Huawei technology has the potential to be sent back to the Chinese government.

Huawei has denied claims that it poses a threat, with an executive telling The Associated Press on Friday that the company is prepared to be “open and transparent” in allowing the U.S. government to assess any risks posed by its technology.

Robert Mayer, the senior vice president of cybersecurity at USTelecom, which represents broadband providers nationwide, told The Hill that the national security risk involving Huawei “comes down to a concern about the relationship between Huawei and the Chinese government,” among other factors.

Mayer noted that banning U.S. companies from doing business with Huawei is particularly tricky in rural areas, where buying Huawei equipment is far cheaper than buying equipment from competitors, especially in light of the company being able to drive down its prices due to Chinese subsidies.

“I would say it’s going to be a significant effort, and for many companies that have embedded Huawei in their 4G networks and desires to evolve the relationship with Huawei into 5G, for those companies weaning themselves off is going to have significant economic impacts for these companies,” Mayer said.

Mayer said that the uncertainty around the Huawei ban is also fueling uncertainty in the telecommunications industry.

“Industry right now has no idea whether the temporary general license will be renewed. If it’s not renewed companies that have Huawei equipment may not be able to secure critical updates and patches,” Mayer said.

The Commerce Department’s Bureau of Industry and Security, which is responsible for issuing a temporary license to allow business with Huawei to continue, did not respond to a request for comment on whether the license would be extended beyond Nov. 19.

A spokesperson for Huawei told The Hill that should the temporary license not be extended, the U.S. economy could take a hit.

“Huawei purchases $11 billion in products from American companies each year,” the spokesperson said. “If Huawei is forced to find alternative suppliers, up to 40,000 to 50,000 jobs could be affected. Huawei will feel pressure in the short term. However, as foreign companies diversify their supply chain to not rely on the U.S., this will have a larger, long-term impact on U.S. companies — and particularly affect individual workers and their families.”

Commerce Secretary Wilbur Ross defended the administration’s decision in August to issue a 90-day waiver extension on Huawei, noting in a Fox News interview that “some of the rural companies are dependent on Huawei” and saying that the extra time was necessary for U.S. companies to “wean themselves off” of using Huawei technology.

Federal agencies are already banned from buying Huawei products, though they are allowed to issue waivers through 2021 if they can justify why more time is needed to implement the ban on Huawei.

{mossecondads}Trump stoked confusion about the Huawei ban when announcing in June at the Group of 20 summit that “U.S. companies can sell their equipment to Huawei.”

While he noted that this would only be in the case of “equipment where there is no great security concern,” his comments prompted a wave of pushback from Capitol Hill, where most lawmakers in both parties consider Huawei a threat to national security.

Lawmakers have continued to voice concerns that the Trump administration could potentially offer Huawei — one of the largest Chinese companies in the world — as a concession to Beijing amid broader trade talks between the U.S. and China.

Sen. Josh Hawley (R-Mo.) told The Hill on Thursday he would not support extending the temporary license, adding that he would “prefer” for the ban to be fully in place now, describing Huawei as “essentially a government-run company.”

“I encourage the president to stand strong on that. I mean, look — we’ve got a lot of leverage with Beijing. Beijing desperately needs a trade deal. I think this is one area where we don’t want to compromise, and I’d urge him to stand strong on Huawei,” Hawley said.

Hawley was among a group of GOP senators who sent a letter last week detailing allegations of “espionage” that Huawei has been involved in after a Microsoft executive complained that the U.S. had not been open about why Huawei was added to the entity list.

House Homeland Security Committee Chairman Bennie Thompson (D-Miss.) also criticized the potential involvement of Huawei in U.S.-China trade negotiations while telling The Hill last week that he had seen “nothing” that would make him agree that the temporary license should be further extended.

“It’s apples and oranges. We’re talking about the security of our country, and I don’t think you can negotiate the security of the American people in trade talks. There is no correlation in my mind,” Thompson said.