Senators Concerned About Defense Department Objection to Commerce’s Proposed Huawei Rule

In a letter to the Defense Department, Sens. Ben Sasse, R-Neb., Tom Cotton, R-Ark., and Marco Rubio, R-Fla., said they are concerned about reports that the agency objected to a proposed rule from the Commerce Department that would have further restricted foreign sales to Huawei. The senators asked the Defense Department to provide information within 60 days about whether the agency objected to the rule, its rationale for doing so and how its objection impacts the agency’s “simultaneous attempts” to prevent allies to reject Huawei technology.

“We are concerned that the Defense Department is not appropriately weighing the risks,” the senators said in a letter to Defense Secretary Mark Esper, according to a Jan, 24 press release. The senators said the rule would have “effectively disrupted” Huawei’s supply chain and requested a “member-level briefing” on the agency's decision.

The letter came less than a week after reports surfaced that both the Defense and Treasury departments objected to a proposed rule submitted by Commerce that would have lowered the U.S.-origin threshold on exports to Huawei to 10 percent (see 2001240012). Commerce subsequently withdrew the rule, according to reports. The Defense Department reportedly issued a non-concurrence to the rule change due to concerns that the rule might significantly hurt U.S. companies. A former top Commerce official said the move would have “dramatic implications” on international supply chains (see 1912130052).