Huawei News Update
U.S. Further Restricts Huawei Access To U.S. Technology & Software
August 17, 2020 – The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has added another 38 affiliates Huawei Technologies located across 21 countries to the Entity List, and further restricted access by Huawei and its non-U.S. affiliates to items produced domestically and abroad from U.S. technology and software by once again amending the foreign-produced direct product (FDP) rule. BIS amended the longstanding foreign-produced direct product (FDP) rule in May 2020 to target Huawei’s acquisition of semiconductors that are the direct product of certain U.S. software and technology. The recent amendment applies the rule to transactions: (1) where U.S. software or technology is the basis for a foreign-produced item that will be incorporated into, or will be used in the “production” or “development” of any “part,” “component,” or “equipment” produced, purchased, or ordered by any Huawei entity on the Entity List; or (2) when any Huawei entity on the Entity List is a party to such a transaction, such as a “purchaser,” “intermediate consignee,” “ultimate consignee,” or “end-user.” The amendment further restricts Huawei from obtaining foreign made chips developed or produced from U.S. software or technology to the same degree as comparable U.S. chips. It is intended to prevent Huawei from circumventing U.S. export controls to obtain electronic components developed or produced using U.S. technology.
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FCC Designates Huawei & ZTE Threats To U.S. National Security
June 30, 2020 – The FCC’s Public Safety and Homeland Security Bureau has released orders designating Huawei Technologies Company and ZTE Corporation, as well as their parents, affiliates, and subsidiaries, as companies posing a national security threat to the integrity of U.S. communications networks and the communications supply chain. In the November 2019 National Security Report and Order, the FCC adopted a rule that prospectively prohibits the use of universal service fund support to purchase or obtain any equipment or services produced or provided by a “covered company” posing a national security threat to the integrity of U.S. communications networks or the U.S. communications supply chain. The FCC initially designated Huawei and ZTE as covered companies and directed the PSHS Bureau to determine whether to issue final designations. The June 30 orders issue final designations for Huawei and ZTE, as well as their affiliates. The final designations are effective immediately. As a result, no universal service support may be used to purchase, obtain, maintain, improve, modify, or otherwise support any equipment or services produced or provided by Huawei or ZTE.
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Huawei Update: FCC Seeking Comment On How Section 4 Of The Secure And Trusted Communications Networks Act Of 2019 Applies To National Security Proceeding Proposals
April 13, 2020 – The FCC’s Wireline Competition Bureau has released a Public Notice to seek comment on how Section 4 of the Secure and Trusted Communications Networks Act of 2019 applies to proposals under consideration in the FCC’s Protecting Against National Security Threats to the Communications Supply Chain rulemaking and related proceedings. In the November 2019 National Security Report and Order, the FCC adopted a rule that prospectively prohibits the use of universal service fund support to purchase or obtain any equipment or services produced or provided by a covered company posing a national security threat to the integrity of U.S. communications networks or the U.S. communications supply chain. The FCC initially designated Huawei and ZTE as covered companies and established a process for designating additional covered companies in the future.
Reimbursement Program. Section 4 of the Secure Networks Act directs the FCC to establish a reimbursement program for “providers of advanced communications service” replacing covered communications equipment or services, and is largely consistent with the FCC’s proposed a reimbursement program. The Bureau is seeking comment on whether the FCC should modify its proposed reimbursement program to implement these new statutory requirements.
Replacement Equipment. Section 4(d)(1) of the Secure Networks Act directs the FCC to develop a list of physical and virtual communications equipment and services to replace blacklisted equipment and services. In general, comment is sought on how to develop a list of suggested replacement communications equipment and services; possible sources of information; and how often the list should be updated.
Comments are due 15 days after the Public Notice is published in the Federal Register, and reply comments are due 30 days after publication. Comments should be filed in WC Docket 18-89 using the FCC’s Electronic Comment Filing System (ECFS).
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Huawei Update: Supply Chain Information Collection Responses Now Due May 22nd
April 2, 2020 – The FCC’s Wireline Competition Bureau and Office of Economics and Analytics have provided a 30-day extension of time for filers to complete the Supply Chain Information Collection. Responses are now due on May 22, 2020. In February, the FCC commenced of an information collection on the use of Huawei Technologies Company and ZTE Corporation equipment and services in U.S. communications networks. Pursuant to the FCC’s 2019 Supply Chain Order, Eligible Telecommunications Carriers (ETCs) must report the extent to which their networks contain or use potentially prohibited equipment or services provided by Huawei, ZTE, or their subsidiaries, parents, or affiliates, and the costs associated with removing such equipment and replacing it with equivalent equipment. The portal for ETCs to submit information is available at www.fcc.gov/supplychain. The information collection is mandatory for all ETCs and their subsidiaries and affiliates. ETCs that do not use equipment or services from Huawei or ZTE are required to report that they do not use such equipment or services.
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Commerce Department Restricts Huawei Technology’s Acquisition Of Semiconductors
May 15, 2020 – The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has amended the foreign-produced direct product rule and the Entity List to narrowly and strategically target Huawei Technology’s acquisition of semiconductors that are the direct product of certain U.S. software and technology. The actions also marks the expiration of the Huawei Temporary General License (TGL). The rule change specifically makes the following foreign-produced items subject to the Export Administration Regulations (EAR): (1) Items, such as semiconductor designs, when produced by Huawei and its affiliates on the Entity List (e.g., HiSilicon), that are the direct product of certain U.S. Commerce Control List (CCL) software and technology; and (2) Items, such as chipsets, when produced from the design specifications of Huawei or an affiliate on the Entity List (e.g., HiSilicon), that are the direct product of certain CCL semiconductor manufacturing equipment located outside the United States. Such foreign-produced items will only require a license when there is knowledge that they are destined for reexport, export from abroad, or transfer (in-country) to Huawei or any of its affiliates on the Entity List. As explained in the Commerce Department Press Release, after BIS added Huawei and 114 of its overseas-related affiliates to the Entity List, companies wishing to export U.S. items were required to obtain a license. But, “Huawei has continued to use U.S. software and technology to design semiconductors, undermining the national security and foreign policy purposes of the Entity List by commissioning their production in overseas foundries using U.S. equipment.” The rule amendment is intended to address these problems.
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Commerce Department Issues Expected Final 90-Day Extension of Huawei Temporary General License Authorizations
May 15, 2020 – The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has announced it is extending the terms of the existing Temporary General License (TGL) authorizations for Huawei Technologies Co. Ltd. and its non-U.S. affiliates on the Entity List for 90 days. The extension is intended to provide users of Huawei devices and telecommunication providers – particularly those in rural U.S. communities – an opportunity to continue to temporarily operate such devices and existing networks while hastening the transition to alternative suppliers. The terms and duration of any future general licenses will be announced prior to the expiration of the 90-day extension. As part of the announcement of the extension, the Commerce Department “is also notifying the public that activities authorized in the TGL may be revised and possibly eliminated after August 13, 2020. Companies and persons relying on TGL authorizations should begin preparations to determine the specific, quantifiable impact of elimination if they have not done so already. Those companies and persons should be prepared to submit license applications to the Department to determine which, if any, activities will be authorized in the event that their TGL authorization is eliminated.”
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Commerce Department Asks for Public Input on Huawei Temporary General License, Extends Current TGL To May 15, 2020
March 10, 2020 – The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) is seeking public comments on the continuing need for, and scope of, possible future extensions of the Temporary General License (TGL) for Huawei Technologies Co. Ltd. and its non-United States affiliates on the Entity List. Comments may be submitted until the end of March 25, 2020. The initial TGL and the three extensions were intended to allow time for companies and persons to shift to alternative sources of equipment, software, and technology. The current TGL extension was set to expire on April 1, 2020, but has been extended through May 15, 2020 to provide for an opportunity for public input. Currently, the TGL gives existing telecommunication providers the ability to continue to temporarily and securely operate existing networks while they identify alternatives to Huawei for future operation. It also authorizes specific, limited engagement in transactions involving the export, reexport, and transfer of items subject to the Export Administration Regulations to Huawei Technologies Co. Ltd. and its non-U.S. affiliates on the Entity List through May 15, 2020. BIS has requested comments to evaluate the need to extend the TGL, whether any other changes may be warranted to the TGL and to identify any alternative authorization or other regulatory provisions that may more effectively address what is being authorized under the TGL. Comments may be filed at regulations.gov.
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FCC Begins Collecting Information On The Use Of Huawei And ZTE Equipment And Services In U.S. Communications Networks; All ETCs Must Respond By April 22, 2020
February 26, 2020 – The FCC’s Wireline Competition Bureau and Office of Economics and Analytics have announced the commencement of an information collection on the use of Huawei Technologies Company and ZTE Corporation equipment and services in U.S. communications networks. Pursuant to the FCC’s 2019 Supply Chain Order, Eligible Telecommunications Carriers (ETCs) must report the extent to which their networks contain or use potentially prohibited equipment or services provided by Huawei, ZTE, or their subsidiaries, parents, or affiliates, and the costs associated with removing such equipment and replacing it with equivalent equipment. The portal for ETCs to submit information is available at www.fcc.gov/supplychain. The information collection is mandatory for all ETCs and their subsidiaries and affiliates. ETCs that do not use equipment or services from Huawei or ZTE are required to report that they do not use such equipment or services. Filings must be submitted on or before April 22, 2020.
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Commerce Department Extends Huawei Temporary General License For 45 Days
February 13, 2020 – The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has extended the Temporary General License (TGL) for Huawei Technologies Co. Ltd. and its non-U.S. affiliates on the Entity List for an additional 45 days. The TGL was implemented as a measure to prevent interruption of existing network communication systems in rural U.S. regions and permit global network security measures, while allowing time for companies and persons to shift to alternative sources of equipment, software and technology.
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Comments On FCC Designations Of Huawei & ZTE As Security Threats Due February 3, 2020
January 3, 2020 – The FCC’s Public Safety and Homeland Security Bureau has announced deadlines to comment on the FCC’s designation of Huawei Technologies Company and ZTE Corporation as “covered companies” in the Protecting Against National Security Threats to the Communications Supply Chain Through FCC Programs Report and Order. In that November 2019 Report and Order, the FCC adopted a rule that prospectively prohibits the use of universal service fund support to purchase or obtain any equipment or services produced or provided by a covered company posing a national security threat to the integrity of U.S. communications networks or the U.S. communications supply chain. The FCC initially designated Huawei and ZTE as covered companies and established a process for designating additional covered companies in the future. Interested parties may file comments responding to the initial designations of Huawei and ZTE as covered companies on or before February 3, 2020.
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Huawei Update: FCC’s USF National Security Blacklist Rule Effective January 3, 2020
January 3, 2020 – A summary of the FCC’s Protecting Against National Security Threats to the Communications Supply Chain Through FCC Programs Report and Order has been published in the Federal Register, making it effective January 3, 2020. The Report and Order prohibits the use of universal service fund support to purchase or obtain any equipment or services produced or provided by a covered company posing a national security threat to the integrity of U.S. communications networks or the U.S. communications supply chain. A requirement that USF recipients certify that they are in compliance with the rule will take effect following revision of certain information collections and their approval by the Office of Management and Budget.
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