BIS Introduces Significant Restrictions On Huawei

May 25, 2020 — On May 19, 2020, the U.S. Department of Commerce, Bureau of Industry and Security ("BIS"), published an amendment to the Export Administration Regulations ("EAR") that will significantly restrict Huawei's ability to use U.S. technology and software to design and manufacture its semiconductors abroad. Before the change, foreign manufacturers could use U.S.-controlled equipment and technology to make and sell most products without being subject to U.S. export controls. The new rule expands the EAR's foreign-produced direct product rule so that certain categories of products (including semiconductors and chipsets) that are a direct product of certain U.S. technology or software (or that are made using equipment that is a direct product of that same technology or software) will require a license to be exported, re-exported, or transferred to Huawei or its many non-U.S. affiliates. Although structured as an interim final rule that became effective on May 15,