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China's Huawei, 70 affiliates on US blacklist

WASHINGTON / NEW YORK (Reuters) – US Department of Commerce said on Wednesday that it is adding Huawei Technologies Co Ltd and 70 affiliates to its so-called "Entity List" – a move that bans the telecom giant from buying parts and components from US companies without US government approval.

FILE PHOTO: The Huawei logo is seen at its showroom in Shenzhen, Guangdong Province, China, March 29, 2019. REUTERS / Tyrone Siu / File Photo

US. Officials told the Reuters decision would also make it difficult, if not impossible, for Huawei, the world's largest telecoms equipment manufacturer, to sell some products due to its dependence on US suppliers.

According to the order that comes into effect the next few days, Huawei will need a US government license to buy US technology. Huawei did not comment immediately.

Minister of Commerce Sekr. Wilbur Ross said in a statement that President Donald Trump supported the decision to "prevent US technology from being used by foreign owners in a way that potentially undermines US national security or foreign policy interests".

The dramatic attraction that the Trump administration has aggressively lobbied other countries not to use Huawei equipment in the next generation's 5G network and comes just a few days after the Trump administration introduced new tariffs on Chinese goods during an escalating trade war. .

The Department of Commerce said the move comes after the US Department of Justice revealed a prosecution in January Huawei and some entities that said the company had cooperated to provide prohibited financial services to Iran. The department said it has a reasonable basis to conclude that Huawei is "engaged in activities that violate US national security or foreign policy interests".

Huawei reported revenue from the first quarter of $ 27 billion last month and said it had sent 59 million smartphones in the first quarter.

In March 2016, the Ministry of Commerce submitted to ZTE Corp to the corporate list of claims that it organized an elaborate system to conceal its re-export of US articles to sanctioned countries in violation of US law.

Restrictions prevented suppliers from providing ZTE with US equipment, potentially freezing the Huawei rivalry supply chain, but they were short-lived. The United States lifted the restrictions in a series of temporary repeats, enabling the company to maintain ties with US suppliers until it reached an agreement a year later.

In August, Trump signed a bill that prevented the US government from using Huawei and ZTE equipment.

Senator Ben Sasse, a republican, said that "Huawei's supply chain depends on agreements with US companies" and he urged the Department of Commerce to see "how we can effectively interfere with our opponent".

Reporting by David Shepardson in Washington and Karen Freifeld in New York; Editing by Chris Reese

Our Standards: Thomson Reuters Trust Principles.

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