Home5G & BeyondUS’ action against Huawei is not an automatic trump card in Europe

    US’ action against Huawei is not an automatic trump card in Europe


    It’s hard to predict the global impact of the President’s export ban on US’ companies selling to Huawei without specific licence, but Europeans remain measured in response.

    US firms, such as Qualcomm, Broadcom, Intel and more than 20 others that are key suppliers to Huawei, will need the US Administration’s explicit permission to sell to the Chinese firm – and they’ve been warned against expecting to get it.

    This will harm American suppliers, with the smaller chip companies feeling the pain soonest, but how much and how many US companies suffer depends on how widely the ban is interpreted by US authorities.

    The phrasing of a separate order signed by President  Trump is designed to stop Huawei from selling 5G telecoms products in the US. Some in the telecoms industry are alarmed that this could result in stopping almost all trade between tech companies in China and the US.

    There is wider concern that about the impact of both orders on the global supply chain.

    Chip shop options

    Huawei has stepped up its efforts with its own HiSilicon facility, but will have to look elsewhere for some components, like radiofrequency chips. It has a number of options including in Japan and Taiwan.

    And in the meantime, Huawei’s CFO is under house arrest in Canada, awaiting extradition to the US.

    European resistance

    Governments in Europe have not given in to Washington’s efforts to make them ban the use of Huawei’s equipment in 5G infrastructure and have not changed their stance since the President’s decision to add Huawei to the list of Chinese companies that are subject to US export controls on the grounds of being perceived as a risk to US national security.

    France’s President, Emmanuel Marron, said at the VivaTech conference, “Our perspective is not to block Huawei or any company” and added, “France and Europe are pragmatic and realistic” and would balance access to good technology and national security regarding Huawei.

    The UK’s Prime Minister, Theresa May, repeated her government’s line that a final decision regarding Huawei and other Chinese suppliers was pending.

    Germany’s biggest industrial association, the Bundesverband der Deutschen Industrie (BDI) says on its website, “The strained transatlantic relationship and the dynamic rise of China pose growing challenges for Europe. Europe has to speak with one voice to not lose touch in the worsening international competition.”

    Two-year lag

    Earlier this year, Europe’s largest telco, Deutsche Telekom warned banning Huawei would set Europe back by two years if it cannot use Huawei technology in 5G infrastructure.

    The European Commission released its strategy for dealing with 5G security in March and is in the process of coordinating a pan-European Union approach to security. Member countries are to submit their views to the EU executive by mid-July.

    The European Union is to complete its own risk assessment by October and, with input from cybersecurity experts, is scheduled to produce pan-Union action plan by the end of this year.

    • Google announced it is withholding important Android software and technical services from Huawei, which will stymy its booming smartphone business. Last year it sold more than 200 million Android handsets, overtaking Apple to become the world’s second largest handset provider.

    Google said its actions are to comply with the export controls and Google Play and Google Play Protect still work on Huawei devices that are in use now.