Exclusive: U.S. nears rule-change to restrict Huawei’s global chip supply – sources

Technology

FILE PHOTO: A Huawei company logo is pictured at the Shenzhen International Airport in Shenzhen, Guangdong province, China July 22, 2019. REUTERS/Aly Song/File Photo

(Reuters) – Senior cabinet officials in the Trump administration agreed to new measures to restrict the global supply of chips to China’s Huawei Technologies, sources familiar with the matter said, as the White House ramps up criticism of China over coronavirus.

Under the change, foreign companies that use U.S. chipmaking equipment would be required to obtain a U.S. license before supplying Huawei. The Chinese telecoms company was blacklisted last year, limiting the company’s suppliers.

Because most chipmaking equipment used worldwide relies on American technology, the change would represent a major expansion of export control authority that some trade experts have said would anger U.S. allies.

It is unclear if President Donald Trump, who appeared to push back against the proposal last month, will sign off on the rule change.

The new measures came after U.S. officials from various agencies agreed on Wednesday to alter the Foreign Direct Product Rule, which subjects some foreign-made goods based on U.S. technology or software to U.S. regulations, the sources said.

Reporting by Karen Freifeld in New York, David Shepardson and Alexandra Alper in Washington; Editing by Nick Zieminski

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