US Companies Sidestep Trump Regulations, Continue Cooperation with HUAWEI
American companies are still selling millions of dollars of products to HUAWEI, despite a Trump administration ban on the sale of American technology to the Chinese telecommunications giant.
Such decisions help HUAWEI to continue to sell strategic products such as smartphones and servers. In addition, this fact emphasizes that even for Trump’s Administration, it is not easy to restrict companies that are labeled as being a “national threat.”
The first wave of prohibitions was misleading for many suppliers of HUAWEI because at that point they were not well-aware of US trade controls, and the transportation of products was suspended on this basis. Later, when the involved parties better understood the legal details, they were able to determine which products could be sold in China. One of the most striking examples is that of the largest US memory card maker, Micron Technology, which was one of the first to publicly prove its right to resume business relations with HUAWEI.
"The company was forced to stop supplying products to HUAWEI, but two weeks ago the process was renewed after close investigation of the relevant laws. We found ways to continue our partnership within the law," said Micron Executive Director Sanjay Mehrotra.
These issues were addressed by law firm Akin Gump's Partner Kevin Wolf, who said American companies are free to keep cooperating with HUAWEI if their products are not manufactured in the US. “A memory card can still be delivered to HUAWEI if its production is made outside the US and does not contain technology that threatens national security,” he said.
American companies are not the only source of important technologies, but within the new regulations, they themselves are in danger of losing an important business partner. That is why some companies are considering transferring production to other countries in order to shirk existing regulations.
Micron's decision was joined by other leading companies, such as INTEL who have also found a way for their products not to be classified as American. However, INTEL has yet to make an official statement on this issue.
Against the backdrop of US companies protesting Trump's prohibitions, HUAWEI’s founder and executive director Ren Zhengfei spoke about the contribution of American companies to the company’s development during a meeting with media. “Partnership with them is very important for us, and this cooperation counts already 30 years. Consequently, the relationship and partnership between the two parties are above politics.”
HUAWEI products and services are available in more than 170 countries and are used by a third of the world's population. There are 16 research and development centers operating worldwide in the USA, Germany, Sweden, Russia, India and China. HUAWEI Consumer BG is one of HUAWEI's three business units, mainly focusing on Smartphones, personal computers, tablets and cloud services. HUAWEI Global Network is based on 20 years’ experience in the telecommunications business and serves to provide innovative technologies to customers around the world.
By Mariam Merabishvili