US Lawmaker Halt Exports to Huawei and SMIC

Representative Mike Gallagher, chair of the House committee on China, has called for a halt in all technology exports to Huawei and SMIC, China’s top semiconductor firm. This request comes in response to the discovery of certain chips in Huawei phones that may breach trade restrictions. Specifically, the Mate 60 Pro model features a chip believed to be the result of significant technological advancements by Semiconductor International Manufacturing Corp (SMIC), a major Chinese semiconductor manufacturer.

Gallagher contends that this chip likely relies on U.S. technology for its production, potentially violating the Department of Commerce’s Foreign Direct Product Rule. He emphasizes the need to cut off technology exports to both Huawei and SMIC as a clear message that any entity undermining U.S. law and national security will face severe consequences.

Huawei was placed on a trade blacklist in 2019 over national security concerns, leading to stringent restrictions on its U.S. suppliers. Similarly, SMIC was added to the entity list in 2020 amid fears of potential diversion of advanced technology for military purposes.

Among the trade restrictions imposed on Huawei and SMIC, the Foreign Direct Product Rule is designed to prevent any company worldwide from utilizing U.S. tools in the production of chips for Huawei. Despite being on these trade lists, suppliers to both companies have received licenses amounting to billions of dollars, permitting them to sell U.S. technology to Huawei and SMIC. It’s worth noting that approximately 90% of these licenses were granted for sales to SMIC.

As of now, the U.S. Commerce Department’s bureau responsible for export controls has not yet responded to requests for comment on this matter.