BIS Issues Huawei FAQs

The Commerce Department Bureau of Industry and Security issued two sets of Frequently Asked Questions involving Huawei and the extension of its temporary general license, including information on what changes came with the extended license, which transactions are covered and more. But the agency did not say whether it planned to again renew the temporary general license when it expires Nov. 18. “Any decision to renew the Temporary General License will be made at the sole discretion of the U.S. Government,” BIS said.

One set of FAQs, centered on Huawei’s addition to the Entity List and the temporary general license, addresses why Huawei was added to the Entity List, what restrictions the list places on companies and clarifies the general license’s savings clause. The FAQs also state that BIS is not offering any additional export license exceptions that are not already listed in the general license for Entity List companies, and said Huawei can return items subject to the Export Administration Regulations back to a U.S. party. If the items are being returned for repair, however, BIS said the items cannot be sent back to Huawei unless they are eligible to be exported under the general license.

BIS said Authorization 1 of the general license allows certain activities that support existing networks with Huawei, including support to operators -- such as “debugging, configuration, and other activities to maintain services” -- “emergency and planned software updates necessary to maintain network operability; in-life upgrades of equipment and components to maintain (but not expand) capacity; and in-life replacements of defective hardware.” The authorization does not allow activities that “will increase or enhance the functionality of the network beyond its current capabilities,” the FAQ said.

In another set of FAQs, BIS explained the function of a general license, specified what changes the August general license made to the May general license and lists which services are covered under Entity List requirements. BIS said services “are generally not subject” to the EAR except in cases of “weapons of mass destruction-related activities.” But BIS said the term ”services” may cause confusion because the telecommunications industry often uses the term “services” when describing “the export or transfer (in-country) of software or technology in terms of, inter alia, operation and/or management of a telecommunications network.” BIS clarified its position by saying “services” are subject to the EAR in any instance in which a U.S. item is sent to Huawei during “the performance of any activity.”

The August general license made several changes to the previous license, including revisions to “certification requirements” and the removal of certain authorizations, BIS said. The new license excludes certain items to clarify the scope of items that are covered in “existing networks,” including “general purpose computing devices,” which BIS said are not within the scope. The new license also clarified which items are covered under “personal consumer electronic devices” to include “phones and other personally-owned equipment, such as tablets, smart watches, televisions, and mobile hotspots such as MiFi devices.” The August general license also clarified definitions for the terms “third parties” and fully operational networks,” BIS said.

The license also changed the general license’s certification requirement by requiring the exporter to “obtain a certification statement from the listed entity” that will receive the items under the license, BIS said. The change also increased the information required in the certification statement to include a list and number of items that will be exported. Under the previous license, exporters were required to create their own certification statement, BIS said. One certification statement may be used for multiple exports, the agency said.