Donald Trump Administration has banned Huawei to do any business with the U.S. Tech companies. While they’re on their reprieval period till August which makes them buy components from the companies for maintenance of the existing products. Huawei has been accused to spy on the American consumers and also alleged to work with the Chinese government for the same.
Amid the ban on Huawei, the U.S. tech companies have found a way to bypass the ban on Huawei without fouling the U.S. regulations. Micron Technology Inc, one of the world’s biggest microchip maker have resumed shipping millions of dollars worth components to the blacklisted company. Qualcomm Inc, the leading manufacturer of wireless chips have also resumed shipping of certain radio-frequency components to Huawei.
Along with other companies, Intel has also found a way to resume shipping to the world’s largest network equipment gear maker. While ON Semiconductor Corp, have is also examining the way to resume the shipping. So, how did they bypass the Trump ban, complying with the Commerce Department?
The blacklisting means that the U.S. companies can’t export any component or technology made in the U.S. But it doesn’t prohibit the export to Huawei from foreign countries, as long as it doesn’t contain 25% of the material originated from the U.S. According to Kevin Wolf, a partner at law firm Akin Gump who was a Commerce Department official in the Obama administration, Regulations don’t precisely say what criteria need to be met to qualify as being manufactured overseas.
“Each company is impacted differently based on their specific products and supply chains and each company must evaluate how best to conduct its business and remain in compliance,” he said in a statement.
Last year, U.S. tech companies business with Huawei was whopping $11 Billion. Therefore, discarding one of the sources of the revenue can drop a hammer on their business.