On May 16, 2019, the Department of Commerce’s Bureau of Industry and Security (BIS) added Chinese-owned company Huawei Technologies Co. Ltd. to its Entity List, placing hurdles on U.S.-based entities wanting to conduct business with the telecommunications equipment producer and seventy-two of its non-U.S. affiliates. Secretary of Commerce Wilbur Ross stated that the addition of Huawei and its affiliates to the Entity List is due to engaging in certain activities that could “potentially undermine U.S. national security or foreign policy interests.” This announcement came directly on the heels of President Trump’s issuance of an Executive Order empowering the U.S. government to block transactions with “foreign adversaries” that could possibly pose a national security threat.
All exports to Huawei and the listed affiliates going forward will require a BIS export license, even if the items are EAR99, severely limiting U.S. telecommunications exports to the company. However, BIS has issued a 90-day general license, temporarily allowing U.S. businesses to engage in transactions, including exports, reexports, and transfers (in-country) of items subject to the EAR, with Huawei and its affiliates. This temporary license is set to expire on August 19, 2019.
For more information on how this could impact your business, contact:
- Martin Lutz, Partner (email@example.com, 512-495-6024)
- Lindsey Roskopf, Attorney (firstname.lastname@example.org, 713-615-8534)
- or another member of the McGinnis Lochridge International Trade and Transactions Practice Group