US Commerce Secretary Wilbur Ross has now reportedly confirmed that the government will allow companies in the region to work with Huawei on 5G. Mr. Ross indicates that the move is intended to strengthen the United States' position in the industry. That's in addition to "protecting national security" interests pertaining to foreign policy. To that end, the Commerce Department and other agencies have signed on to allow companies in the US to work with Huawei on 5G standards.
The rule change follows the addition of Huawei to the US Entity List last year. That effectively banned US companies from working with Huawei across the board. It has also discouraged some companies outside of the region from working with the Chinese tech giant.
US companies such as Qualcomm have been calling for such a rule since late 2019. The CEO of Qualcomm pointed out, at the time, that standards are imperative. And, without the interaction and cooperation of international companies and industry leaders such as Huawei, global standardization is not possible. Or, the US simply won't be a part of setting the standards.
This won't just apply to 5G technologies either
As noted above, this doesn't necessarily change things for Huawei. It does mean that the company can continue working on the standardization of technologies it leads on. But it doesn't mean that it will be able to move forward with its proposal to license 5G tech to US companies, for example.
Perhaps more importantly, it doesn't allow Huawei to step away from bans that have forced the company to look elsewhere for components for its products. The company has had a great deal of difficulty sourcing those for everything from its smartphones and tablets to its chipset division.
In some cases, that's been a direct result of long-time partners opting to work in and with the US as opposed to working with Huawei. But it will extend further than just 5G too.
According to the reported announcement from the Commerce Department, the US needs to be participating in standards-setting for all upcoming tech advancements. That, of course, includes 5G. But it also includes the US maintaining "influences" on standards for autonomous vehicles, artificial intelligence, and "other cutting-edge technologies."
The implication is that the Commerce Department doesn't want to see any US company or partners left behind on big tech innovations. So it appears to be setting up and maintaining a line between two activities. Namely, those are working with a banned company and working with a banned company on standards. Those standards aren't necessarily going to be limited to 5G or even to Huawei if the US is going to remain in the loop and competitive.
When does this rule go into effect?
With the new rule in place, companies will be able to work with the banned company. But it's not immediately clear how far that will extend. Presumably, that will extend to other banned companies too. Or at least it will as long as those companies have a measurable impact on the formation of standards. Or if the company in question is an industry leader in its respective technology fields.
That will likely be clarified with the publication of the rule.
The rule change could be published as early as today. It is currently waiting to be published by the Federal Register. That's according to individuals reportedly familiar with the process.