In a Federal Register notice published on August 21, the Department of Commerce’s Bureau of Industry and Security (BIS) announced that it has added 46 non-U.S. affiliates of Huawei Technologies Co., Ltd. (Huawei) to the Entity List because they “pose a significant risk of involvement in activities contrary to the national security or foreign policy interests of the United States.” This is in addition to the 68 Huawei entities listed in May 2019 (see Trump and Trade Update of May 17, 2019); similarly, BIS has imposed a license requirement for all items subject to the Export Administration Regulations (EAR) for exports to these Huawei entities. Any export/reexport from the United States or shipments involving U.S.-origin items or technology to Huawei or any of these listed affiliates will require an export license from BIS; while these license applications will be reviewed by the agency on a case-by-case basis, the review will be conducted under a “presumption of denial.”

The additions (and certain modifications/clarifications made to the original list of 68 entities) affect affiliates of Huawei in 25 different countries: Argentina, Australia, Bahrain, Belarus, Belgium, Brazil, People’s Republic of China, Costa Rica, Cuba, Denmark, France, India, Indonesia, Italy, Kazakhstan, Mexico, New Zealand, Panama, Portugal, Romania, Russia, South Africa, Sweden, Thailand and the United Kingdom. BIS stated that “without the imposition of a license requirement to these affiliated entities, there is reasonable cause to believe that Huawei would seek to use them to evade the restrictions imposed by its addition to the Entity List.”

In addition to these Entity List additions, BIS announced via Federal Register notice that it has extended the temporary general license it issued in May 2019 (see Trump and Trade Update of May 21, 2019) that partially continued the availability of exports under the Export Administration Regulations (EAR) for exports, reexports and transfers (in-country) to Huawei Technologies Co., Ltd. and its affiliates. The temporary general license has been extended through November 18, 2019, and does not relieve parties of other obligations under the EAR as to other licensing requirements for exports to the People’s Republic of China. For U.S. persons currently exporting to Huawei entities under the temporary general license, a review of this extension is highly recommended. In addition to the extension of another 90 days, BIS has made several clarifications as to authorized transactions under the license to improve “public understanding of the intended scope of the temporary general license.” BIS also highlights that the Entity List does not create a license requirement for imports, including imports from entities on the Entity List. The agency notes that Entity List-based license requirements do not apply to services, “provided the service in question does not involve the export, reexport, or transfer (in-country) of items that are subject to the EAR.” When providing a service, however, a U.S. person must determine if there will be an export of any physical items, software or technology requiring license authorization.