Explainer: Why the United States Banned Huawei

On 15 May 2019, the Bureau of Industry and Security, an agency of the United States Department of Commerce, added the Chinese multinational technology company Huawei and 70 other foreign subsidiaries and affiliates to its Entity List under the Export Administration Regulations, thus effectively blacklisting the company and banning U.S. companies from doing business with them without a government license.

The announcement resulted in the immediate action from U.S. companies and corresponding repercussions to Huawei. For example, to comply with the regulation, Google announced that it would stop providing the company access to its Android operating system and the Google Play Store, including software updates.

But why exactly the United States banned Huawei? Why were U.S. companies were barred from doing business with Huawei? What were the findings and basis for the restrictions?

The Reasons Why the United States Banned Huawei

The document published by the Bureau of Industry and Security explained that Huawei “knowingly and willfully” caused the direct and indirect export, sale, and supply of goods, technology, and services from the U.S. to Iran and the government of Iran without securing a license from the Office of Foreign Assets Control of the Department of Treasury.

It is important to note that the U.S. currently has a tensed relationship with Iran. To be more specific, the U.S. government has issued a trade embargo and other economic sanctions on Iran. The conflict between these two countries stemmed from the intention of the American government to dismantle the Iranian nuclear weapons program.

Nevertheless, the activities of Huawei and several of its subsidiaries and affiliates with Iran ran against the existing American trade embargo. The Bureau of Industry and Security noted that there was a reasonable cause to believe that the company pursued activities contrary to the national security or foreign policy interests of the U.S.

But the aforementioned was not the first time the U.S. banned the Chinese tech company. The national defense spending bill signed in August 2018 barred the U.S. government from purchasing equipment from Huawei and ZTE due to allegations that the Chinese government was using these companies to spy on other countries.

Several other countries, including Canada, India, and the United Kingdom, have also expressed similar concerns over security and espionage. However, the company has repeatedly denied any involvement with controversial political factions or the allegation that the Chinese government mandates it to include backdoors in the networking equipment it sells.

FURTHER READINGS AND REFERENCES

  • Bureau of Industry and Security. 2019, May 21. “84 FR 22961: Addition of Entities to the Entity List.” Federal Register: The Daily Journal of the United States Government. Available online
  • Lee, T. B. 2018, August 14. “New Law Bans US Government from Buying Tech From Chinese Giants ZTE and Huawei.” Ars Technica. Available online