Supply Chain Executive Order May Result in More Huawei Restrictions, Lawyers Say

The supply chain security executive order issued in May is directly related to Huawei, Akin Gump lawyers said, and will likely restrict Huawei from selling certain items if those items impact U.S. national security. The executive order (see 1905160072) requires the Commerce Department to issue regulations within 150 days (that is, by Oct. 14) and bars "transactions involving information and communications technology [ICT] or services" without a broad interagency review.

Although regulations have not yet been formally implemented, the order plans to use the International Emergency Economic Powers Act to restrict certain transactions that pose a risk to the U.S. “What we’re anticipating this is going to do is restrict what can be sent from Huawei,” Akin Gump lawyer Tristan Denour said during a July 18 webinar. “It’s going to prohibit certain transactions that the United States identifies as a national security threat in the information and communications space.” Denour said regulations are expected in “mid-October.”

Huawei and China are not mentioned in the executive order, lawyer Mac Fadlallah said on the webinar, but “it is just widely speculated that there is a very, very strong political connection between those two things. That the impetus behind the supply chain security executive order is China.” Although the order will likely impact Huawei, “there’s more that needs to be clarified once the regulations come out,” Fadlallah said.