Representative Mike Gallagher, the Chair of the House of Representatives’ committee on China, has urged the U.S. Commerce Department to terminate all technology exports to Huawei and China’s leading semiconductor manufacturer, Semiconductor International Manufacturing Corp (SMIC). This call follows the revelation of new chips integrated into Huawei smartphones, which may potentially breach existing trade restrictions.
The remarks from Representative Gallagher, a prominent Republican legislator, come in the wake of Chinese tech giant Huawei’s recent release of the Mate 60 Pro smartphone. Analysts have speculated that this phone incorporates a chip achieved through a technological breakthrough attributed to SMIC.
Gallagher voiced his concerns, stating, “This chip likely could not be produced without US technology, and thus, SMIC may have violated the Department of Commerce’s Foreign Direct Product Rule. The time has come to end all U.S. technology exports to both Huawei and SMIC to make it unequivocal that any entity flouting U.S. law and jeopardizing our national security will face technology embargoes.”
Huawei was placed on a trade blacklist in May 2019 due to national security apprehensions, compelling U.S. suppliers and others to seek special licenses for shipments to the company. SMIC was added to the entity list in December 2020 amid concerns about the potential diversion of advanced technology for military purposes.
The trade restrictions on Huawei and SMIC encompass the Foreign Direct Product Rule, designed to prevent any entity worldwide from utilizing U.S. tools to fabricate chips for Huawei.
However, previous reports by Reuters have indicated that suppliers to Huawei and SMIC have been granted licenses worth billions of dollars to provide U.S. technology to these entities, despite their inclusion on the trade blacklist. Approximately 90% of these licenses were for sales to SMIC.
Requests for comments made to the U.S. Commerce Department’s export control bureau remain unanswered as of the time of reporting.