Blacklist Archives - Gizmochina

Huawei, ZTE face stricter restrictions as US lawmakers pass new bill

Sean — Fri, 29 Oct 2021 10:26:04 +0000

Lawmakers in the US have unanimously voted for a new bill that will tighten the reins around Huawei and ZTE. The US Senate voted earlier this week to bring to approve a legislation that will prevent the companies that are labelled as a security threat from gaining access to equipment licenses from US regulators.

According to an SCMP report, The new bill is the Secure Equipment Act, which is the latest move from the US government to restrict the Chinese telecommunications giant. This bill was brought to the US House last week and saw a 420-4 vote and has now been sent to President Joe Biden for his signature. Notably, the latest push back from the US lawmakers arrives after it was recently found that suppliers of blacklisted Chinese brands like Huawei and SMIC were still being granted` export licenses that were worth 61 billion US Dollars.

Republican Senator Marco Rubio, “Chinese state-directed companies like Huawei and ZTE are known national security threats and have no place in our telecommunications network.” This new bill would prevent the FCC (Federal Communications Commission) from reviewing or issuing new equipment licenses to firms on the FCC’s “Covered Equipment or Services List.” For those unaware, Huawei and ZTE were placed on trade blacklist back in 2019 and were later designated as national security threats and barred from the US communications network.

Back in June, the FCC had also unanimously to advance plans to ban approvals for equipment in US telecommunications network that are made from these Chinese companies. Although, this vote was withdrawn due to strong opposition from China. Zhao Lijian, a spokesperson at China’s foreign ministry had stated that The United States, without any evidence, still abuses national security and state power to suppress Chinese companies.”

US Senator urges Biden administration to blacklist Honor similar to Huawei

Sean — Fri, 15 Oct 2021 08:36:07 +0000

Earlier this week, Republican Senators led by Marco Rubia urged the Biden administration to blacklist Honor, which is a former subsidiary of the Chinese tech giant Huawei that had had previously been designated as a national security threat.

According to an SCMP report, the US Senators sent a letter to the Biden administration on 14th October 2021. In this letter, Honor was described as an entity that is an “arm” of the Chinese government. The letter further added that the Chinese smartphone maker also has access to the US technologies that is currently being denied to its former parent brand, Huawei. In other words, the Senators are seeking to blacklist the company in a similar fashion.

Rubio wrote that spinning off Honor has let Beijing “effectively dodged a critical American export control.” For those unaware, Huawei had sold off its budget sub brand back in November 2020 to ensure its survival. The letter also stated that “By failing to act in response, the Department of Commerce risks setting a dangerous precedent and communicating to adversaries that we lack the capacity or willpower to punish blatant financial engineering by an authoritarian regime.”

Unfortunately, Honor as well as the US Commerce Department and the Chinese Embassy in Washington has yet to respond to requests for a comment regarding this matter at the moment. Huawei has also declined to provide any comments, but pointed to a previous statement in which it assured that it would not hold any shares or will be involved in managing Honor in any manner.

US Republicans seek to expand restrictions on export of Chip tools to China

Sean — Mon, 19 Apr 2021 11:13:00 +0000

Two Republican lawmakers in the US are calling for the expansion of restrictions against export of chip making tools to China. This arrives after the US government recently added seven new Chinese supercomputing based entities in its trade blacklist.

According to a BloombergQuint report, Michael McCaul of Texas, the top Republican on the House Foreign Affairs Committee, and Arkansas Senator Tom Cotton have asked the US Department of Commerce to make it mandatory for American based tech firms that make electronics design automation tools, which are used to help design computer chips, to obtain a license from the government before allowing export of any products to China.

As per McCaul and Cotton wrote in a letter to Commerce Secretary Gina Raimondo, “There is clear evidence that companies linked to the Chinese Communist Party military are using this software technology to develop advanced weaponry.” Previously, the US added seven Chinese supercomputing based firms into its trade blacklist, which prevents them from receiving exports from American companies. The reason for the blacklisting is due to alleged national security risks.

The two lawmakers also asked the State and Commerce departments to find a way to “mitigate the risk of Taiwanese companies providing services and technologies to entities of concern,” further adding that the Taiwan Semiconductor Manufacturing Company (TSMC) shouldn’t be making advanced chips for China’s military. We also reported on TSMC officially suspending new orders from one of the companies blacklisted by the American government.

TSMC to suspend chip orders to Chinese supercomputing firms over US Sanctions

Sean — Fri, 16 Apr 2021 07:35:38 +0000

The US recently added new entities into its trade blacklist, which were from Chinese origin. Now, the impact of these sanctions are already showing effects as TSMC (Taiwan Semiconductor Manufacturing Company ) has suspended new chip orders from one of the newly blacklisted firms.

According to a SCMP report, the world’s largest contract chip maker has stopped taking orders from Phytium Information Technology Co, which is one of the seven Chinese supercomputing related firms that were added to the US Entity List last week. As per a source close to the matter, the company will complete any existing orders that were placed before the Chinese firms were added to the blacklist over national security allegations.

Furthermore, a TSMC representative decline to comment on the matter but did state that the company would “abide by all the laws and regulations as always, and will operate according to the export restrictions.” Meanwhile, Phytium has yet to offer any statement regarding this matter. At the moment, while China is investing heavily in the development of its local semiconductor technology, it is still reliant on foreign technology and chips from overseas.

The nation’s supercomputers use processors made by tech giants like Intel, AMD, and IBM. According to Francis Lau, a computer science professor at the University of Hong Kong, “The sanctions would definitely affect China’s ability to keep to its leading position in supercomputing because all current supercomputers use mostly US-built components. Although there are alternatives made by other countries such as Japan and [South] Korea, the best components are still by the US.”

Taiwan says Chip firms will comply with new US rules that blacklists Chinese companies

Sean — Wed, 14 Apr 2021 09:50:29 +0000

Earlier today (14th April 2021), Taiwan said that its chip based firms will comply with the new US regulations, which had Washington add seven Chinese companies into its economic blacklist.

According to a Reuters report, these companies include China based supercomputing firms, which the US Commerce Department said were “involved with building supercomputers used by China’s military actors, its destabilizing military modernization efforts, and/or weapons of mass destruction programs.” For those unaware, blacklisted companies or other firms on the list are required to apply for licenses from the Commerce Department and face strict scrutiny when they seek permissions to receive items from suppliers based in the US.

At the moment, Taiwan is a major supplier of semiconductors for various industries across the globe. Now, Taiwanese Economy Minister Wang Mei-hua stated that the local chip firms will follow US rules and regulations, saying that “Our companies, whether producers or exporters, must accord with our country’s rules. Of course the United States has new rules, and our companies will pay attention and accord with the key criteria of the U.S. rules.”

Notably, the addition of the seven new firms into the blacklist arrives amid rising frictions between China over Taiwan. Furthermore, the tensions are also high amid the global shortage of semiconductors that has affected various industries around the world and disrupted supply chains globally. So stay tuned for more, as we will be providing updates when additional information is available regarding this matter or any other important developments.

Xiaomi win against Trump ban prompts lawsuits from other blacklisted Chinese firms: Report

Sean — Wed, 17 Mar 2021 07:31:26 +0000

China based firms that were previously targeted by the ban imposed by the Trump administration are now considering filing lawsuits against the US government. This news arrives after a federal judge suspended a similar ban earlier this month, which was imposed on Xiaomi.

According to a Reuters report, lawyers close the matter with a few of the blacklisted Chinese companies are in talks with various law firms like Steptoe & Johnson and Hogan Lovells. These firms are eyeing a lawsuit after US District Judge Rudolph Contreras’s preliminary order halted the inclusion of Chinese tech giant, Xiaomi, on the list of companies that allegedly have ties to the Chinese military. For those unaware, these blacklisted firms faced an investment ban in the US.

As per Wendy Wysong, managing partner of the Hong Kong office of Steptoe & Johnson, “Companies are reaching out to lawyers to challenge the listings and the grounds for the listings.” However, Wysong and sources close to the matter from Hogan Lovells have declined to name the companies involved in discussions. Notably, the process for including companies in the investment ban has been called “deeply flawed” by Contreras.

This is due to blacklisted companies on two key criteria, which is its development of 5G technology and artificial intelligence. The latter is what the Defense Department alleges are “essential to modern military operations.” Washington lawyer Brian Egan stated that “The facts that led to Xiaomi’s designation are almost laughable, and I think it absolutely is going to lead to additional companies seeking relief.”

Xiaomi gets court injunction stopping US blacklisting

Jeet — Mon, 15 Mar 2021 08:06:34 +0000

A few weeks ago, the Defence Depart of the United States under the Donald Trump administration had tagged Xiaomi as a company with ties to the Chinese military, putting financial restrictions on the Chinese firm, which were scheduled to go into effect next week.

However, before the restrictions could go into effect, a U.S. District Jude has put a temporary halt on the ban. The judge sided with Xiaomi in a lawsuit that argues that the move by the United States government was “arbitrary and capricious” and deprives the company of its due process rights.

In mid-January, Xiaomi and eight other Chinese companies were added to a list by the Defence Department that requires Americans to sell their interests in the firms. Soon after that, Xiaomi filed a complaint in a Washington court seeking to be removed from the list, calling its inclusion “unlawful and unconstitutional” and arguing it was not controlled by the People’s Liberation Army.

Xiaomi is the world’s third-largest smartphone manufacturer by volume. The company is likely to win a full reversal of the ban as the litigation unfolds. After the ban was announced, the company faced the prospect of being delisted from U.S. exchanges and deleted from global benchmark indexes.

In the ruling, U.S. District Judge Rudolph Contreras in Washington, D.C., said that the court “concludes that defendants have not made the case that the national security interests at stake here are compelling.”

In a statement, a Xiaomi spokesperson welcomed the ruling and said that the designation of Xiaomi as a Chinese military company “arbitrary and capricious.” It also indicates that Xiaomi plans to continue to request that the court declare the designation unlawful and to permanently remove the designation.

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US seeks to blacklist various Chinese firms, including SMIC: Report

Sean — Fri, 18 Dec 2020 09:01:57 +0000

The US is apparently planning on adding various Chinese companies to its trade blacklist today (18th December 2020). This would also include China’s largest chipmaker SMIC, as per two sources close to the matter.

According to a Reuters report, the move is the latest from the Trump administration’s efforts against China. Notably, it arrives just a few weeks before the Democratic President Elect Joe Biden takes the office, on January 20. As per the sources, the US government is aiming to add around 80 additional companies and affiliates to the ‘Entity List,’ which mostly comprises of China based firms.

Furthermore, the US Department of Commerce is also expected to designate some of these Chinese companies as allegedly having ties to China’s military, or are aiding in the construction and militarization of artificial islands in the South China Sea. Some of the companies even have allegedly been involved in human rights violations, as per the source. At the moment, the Trump administration has added more than 275 China based companies and their affiliates to the Entity List to target key Chinese industries.

This most notably includes Huawei Technologies and ZTE, two major consumer electronics and telecommunications equipment providers. Now, even SMIC is reportedly the latest target for Washington, as the Commerce Department previously mandating suppliers to the company to apply for export licenses after stating that there was an “unacceptable risk” with its equipment being possibly used for military purposes.

Unfortunately, SMIC, the Commerce Department, or even the Chinese Embassy in Washington has yet to respond to this report. Similar to other Chinese firms, SMIC has denied the accusations of ties to China’s military. If the chipmaker is put on the Entity List, the company would be forced to seek a special license from the Commerce Department before being supplied with key components or materials from US based firms.

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Trump to add China’s SMIC and CNOOC to its blacklist: Report

Sean — Mon, 30 Nov 2020 07:55:09 +0000

The Trump administration is apparently planning on making another move against Chinese corporations. This time, the President seeks to add SMIC and CNOOC to its blacklist of alleged Chinese military companies.

According to a Reuters report, documents and sources have surfaced, which claim that Donald Trump is aiming to add to new companies to the blacklist over alleged ties with the Chinese government. Reportedly, the administration plans on cutting their access to US investors, which will likely raise the tensions between Beijing and Washington. This also arrives weeks before the President-elect Joe Biden takes office as the next president of the United States.

Previously, it was reported that the DOD (Department of Defense) was planning on designating four more Chinese firms as owned or controlled by the Chinese military. The new companies being added to the blacklist would bring the number of Chinese companies affected to 35 in total. For those unaware, SMIC is the top chipmaker in China while CNOOC is a known Chinese offshore oil and gas producer.

Furthermore, a recent executive order issued by the President Trump would prevent US investors from buying securities of the listed firms starting next year. While it is unclear when the administration will add both firms to the list, documents and three sources have pointed at SMIC (Semiconductor Manufacturing International Corp) and CNOOC (China National Offshore Oil Corp) being added soon to the Federal Register.

SMIC has since stated that it will continue “to engage constructively and openly with the U.S. government,” and even refuted the allegations and saying that its products and services were solely for civilian and commercial use rather than military. It further added that it “has no relationship with the Chinese military and does not manufacture for any military end-users or end-uses.” SMIC heavily relies on equipment from US suppliers, so facing scrutiny by the Trump administration might create significant obstacles in its operations.

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