U.S.A. said to expand Reprieve for Huawei

WASHINGTON – The Trump administration is set to extend a license again that will allow US companies to continue doing business with Huawei, the Chinese telecom giant, said people familiar with the talks.

Huawei's fate has been balancing for months as the Trump administration overcame how to treat a company that many US officials consider a national security risk, but the Chinese government sees it as central to its technological ambitions. While the company's future is not technically part of the trade talks between the two countries, President Trump has listed Huawei as a potential bargaining chip in a protracted trade war.

In May, the Department of Commerce placed Huawei, which builds advanced 5G networks that will be central to the next generation of wireless communications, on a blacklist that banned the company from purchasing US products without government approval.

The ban caused problems for telecommunications companies in rural areas of the United States, which rely on Huawei for parts and equipment, as well as US companies that rely on selling to the Chinese company. To give them time to adapt to the new order, the Department of Commerce gave a general reprieve that allowed companies to continue doing business with Huawei for a short time.

This deferral will expire on Monday, but the administration is expected to extend it for a period. It would be the third time an extension is granted. However, the decision may change given ongoing trade discussions between the US and China.

Chinese dealers have repeatedly pressed their American counterparts to lift sanctions against Huawei, and are likely to see a temporary reprieve as a good will in the trade. conversations that are critical.

Washington and Beijing are trying to reach a "Phase 1" trade agreement that would resolve some of the administration's concerns about China's economic practices. Trump Trump announced last month that the United States had reached a preliminary agreement with the Chinese. But in recent weeks, it appears that the countries have not signed an agreement than he originally suggested.

The administration is also under pressure from companies that sell components to Huawei and the telecommunications companies that buy Huawei equipment. In an interview Monday with Fox Business Network, Commerce Secretary Wilbur Ross said earlier printouts were intended to allow telecommunications companies in the United States to "continue to operate."

"Unfortunately, they are very dependent on Huawei for 3G and 4G," he said. “There are probably problems with telephone service in the rural communities; we don't want to knock them out. So one of the main purposes of the temporary general licenses is to let the guys in the countryside continue to operate. ”

Huawei declined to comment. The news of the license extension was first reported by Politico.

The Trump administration is also considering separate product-specific licenses that will allow select companies to deliver non-sensitive goods to Huawei, despite the blanket ban.

People familiar with the case said that Trump had given the green light in early October for the licenses to be approved. But progress toward a US-China Phase 1 trade agreement stopped in the following weeks, and the licenses were not issued.

Their timing is now the subject of internal debate in the Trump administration, and probably depends on China and the US signing a Phase 1 trade agreement that remains uncertain.

The Federal Communications Commission is expected to vote next week on a measure that would prohibit companies from using federal subsidies on equipment made by Huawei or ZTE, another Chinese telecommunications company. Carriers serving rural areas, which have purchased Huawei equipment because it is cheaper than non-Chinese alternatives, have said they are concerned that the proposal will harm their business.

Ajit Pai, the commission's leader, said in a statement last month that vendors put in place the next generation of wireless technology, the agency could not ignore the chance "that the Chinese government will seek to exploit network vulnerabilities to engage in espionage."

Asked last month about Huawei's relationship to the Phase 1 deal he had announced with China, Trump said, "We have not discussed Huawei in relation to this agreement." A few minutes later, he added, "Well, we'll see what happens. We'll discuss that in Phase 2."

David McCabe contributed reporting.

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