Huawei, SMIC suppliers obtained billions price of licenses for U.S. items -documents By Reuters


© Reuters. The Huawei logo is pictured in the Manhattan neighborhood of New York, New York, USA on July 22, 2019. REUTERS / Carlo Allegri / Files

By Karen Freifeld and Alexandra Alper

WASHINGTON (Reuters) – Suppliers to Chinese telecommunications giant Huawei and China’s leading chipmaker SMIC received billions of dollars in licenses to sell them goods and technology from November to April, despite being blacklisted for U.S. trade, according to Reuters showed on Thursday.

According to the documents, 113 export licenses worth $ 61 billion have been approved for suppliers to ship products to Huawei, while another 188 licenses worth nearly $ 42 billion have been approved for Semiconductor Manufacturing International Corp (SMIC).

The data also showed that more than 9 out of 10 license applications were granted to SMIC suppliers, while 69% of applications for delivery to Huawei were approved over the same period.

The House of Representatives’ foreign affairs committee on Thursday voted to grant a request from top Republican member Michael McCaul to release the license data it received from the Commerce Department in May.

Reuters Republicans on the committee made the documents available to Reuters upon request from Reuters after approval. The documents are expected to be made public shortly.

The numbers could upset China hawks in Washington, who have made concerted efforts to keep Chinese companies from accessing advanced US technology.

“It is clearly in our national interest to increase transparency and public scrutiny over how our nation transfers its technology to an adversary,” McCaul said in a statement.

The Commerce Department said in a statement that releasing an arbitrary snapshot of licensing permits “risks politicizing the licensing process and misrepresenting the government’s national security regulations.”

It also stressed that approved license applications do not constitute actual deliveries and about half of all licenses are used. It added that license applications involving Huawei and SMIC will be processed according to guidelines developed by the Trump administration and managed by the Biden administration.

Huawei declined to comment, while SMIC did not respond to a request for comment.

Huawei was blacklisted in May 2019 because of national safety concerns, forcing its U.S. suppliers and others to obtain a special license to ship goods. SMIC was added to the so-called entity list in December 2020 because of concerns that it could redirect advanced technology to military users.

Most of the licenses issued did not allow the dispatch of sensitive objects. Of the 113 licenses approved for Huawei during the reporting period, 80 were for non-sensitive items that only required one license because the recipient was blacklisted. At SMIC it was 121 out of 188.

Licenses are usually valid for four years.

Reuters reported earlier this year that during the Trump administration licenses worth $ 87 billion -huaweis -suppliers-idUSKBN2B3336 for Huawei were approved after it was blacklisted.

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