Huawei’s day of reckoning arrives – but it has been preparing for almost a year
- US Commerce Department added Huawei and 70 affiliates to its Entity List, saying the company was engaged in activities ‘contrary to US national security’
- Of Huawei’s hundreds of global suppliers, it considers 92 as core suppliers, including 33 from the US
Huawei has been saving for a rainy day, and that day has come.
The Shenzhen-based company, which claims to be the “unparalleled leader in 5G” and recently overtook Apple in global smartphone sales, has been stockpiling critical US components for almost a year, according to separate reports by research houses Haitong and Canalys. The move was to ensure it can continue making its products that rely on core technology from US suppliers such as Intel and Qualcomm.
On Wednesday, the US Commerce Department added Huawei and 70 affiliates to its Entity List after it concluded that the Chinese company was engaged in activities “contrary to US national security or foreign policy interests”.
On the same day, US President Donald Trump signed an executive order barring the use of telecommunications equipment from companies that are deemed a threat to national security, clearing the way for an outright US ban on products made by Huawei, though the order did not name China or Chinese companies specifically.
Inclusion on the Entity List means that a US company, person or government agency selling US technology to Huawei requires a license from the Bureau of Industry and Security (BIS).
Huawei declined to comment on its inclusion on the Entity List or whether it has been stockpiling, but a spokesperson said: “All companies have business continuity plans … [it is the] only responsible way to do business.”