As the U.S. has increased efforts that might impact Huawei, the regulators are contemplating changes to tighten the noose on chip sales.
In a bid to put a break on the exports to the world’s no 2 smartphone maker, The Commerce Department revealed the new rule, alluding to the need of license for sales to Huawei of semiconductors made abroad with U.S. technology.
The rule has faced flak for having “profound loophole.” The rule is said to have covered merely chips designed by Huawei and does not cover shipments if they are sent to customers of Huawei. The flaw has enabled U.S. companies to supply Huawei with chips made outside the U.S.
Quoting State Department Official Christopher Ashley Ford, it has been reported that the rule would help regulators decide if it should be modified.
Elaborating on the rule, Ford has stated that it would give them insights to make export control decisions as they are in a quest to find the silver bullet to these challenges.
He went on to claim that regulators would observe the happening and make changes if it is deemed necessary. Huawei has refused to comment.
For the uninitiated, the company was added to entity list of Commerce in the preceding year in the wake of national security concerns. Huawei is accused of violating stealing intellectual policy, spying on customers and violating U.S. sanctions on Iran, accusations Huawei has rejected.
An industry lawyer has allegedly said that tweaking the language would be an apt way to change the rule to capture chip sold to the benefit of Huawei; however, such modifications would not be without challenges.
A Commerce Department Official Cordell Hull has apparently stressed that enforcement arm of the agency will look for ways to avoid the rules.