During the week of May 13, 2019, the Trump administration announced two new measures that have the potential to cut off certain foreign companies, particularly Chinese technology company Huawei Technologies Co., Ltd., from the U.S. technology and telecommunications market. These provisions follow legislation passed in 2018 prohibiting U.S. government agencies and contractors from using Huawei products and reflect a heightened concern regarding the national security risks associated with non-U.S. entities’ involvement in the U.S. technology and telecommunications sectors.
On May 16, 2019, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) filed a Federal Register notice adding Huawei, along with 68 of Huawei’s non-U.S. affiliates, to its Entity List. The Entity List identifies companies that BIS reasonably believes to be involved in “activities contrary to the national security or foreign policy interests of the United States.”
On May 15, 2019, President Donald Trump issued an Executive Order on Securing the Information and Communications Technology and Services Supply Chain. The new Executive Order (E.O.) establishes the legal authority to prohibit certain transactions involving “information and communications technology or services” where a foreign party acquires an interest in property subject to U.S. jurisdiction. While the E.O. does not mention any specific country or company, recent events strongly suggest that Chinese companies generally, and Huawei specifically, may be targets of the new E.O.
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