A declaration Thursday from the Commerce Department cleared up any guesswork about the target of a new executive order on supply chain risk.
President Trump signed an executive order Wednesday prohibiting government agencies from buying communications technology—or tools or services that incorporate such technologies—developed by corporations operated or influenced by foreign adversaries. Based on recent events—including a Justice Department indictment in January—most assumed the order was directed at Huawei, a Chinese telecom firm.
Experts and officials in the U.S. and globally have been warning about Huawei’s practices and connection to the Chinese government, leading to fears that the company is helping China spy on other nations through its technology.
On Wednesday, Commerce Secretary Wilbur Ross further escalated pressure on Huawei and 70 of its affiliates by adding the Chinese tech firm to the Bureau of Industry and Security’s Entity List, which restricts the company from purchasing or otherwise integrating U.S. technologies without a waiver.
“The sale or transfer of American technology to a company or person on the Entity List requires a license issued by BIS, and a license may be denied if the sale or transfer would harm U.S. national security or foreign policy interests,” according to a statement from the Commerce Department.
“This action … places Huawei, a Chinese owned company that is the largest telecommunications equipment producer in the world, on the Entity List,” Ross said Thursday. “This will prevent American technology from being used by foreign owned entities in ways that potentially undermine U.S. national security or foreign policy interests.”
The order signed Wednesday also gives Ross one year to report on the effectiveness of the new supply chain rule with regard to Huawei and others.