The U.S. Department of Commerce has issued a Temporary General License (TGL) which allows for “limited engagement in transactions” with Huawei and its affiliates. In effect, this means that companies, such as Google, can continue to do business with the Chinese firm. The TGL is only temporary and expires 90 days after it was issued (May 20, 2019) which takes us up to Sunday, August 18, 2019.
The Secretary of Commerce, Wilbur Ross, commented on the decision, saying:
“The Temporary General License grants operators time to make other arrangements and the Department space to determine the appropriate long term measures for Americans and foreign telecommunications providers that currently rely on Huawei equipment for critical services. In short, this license will allow operations to continue for existing Huawei mobile phone users and rural broadband networks.”
The temporary lifting of the ban will have benefits for three groups: Huawei, customers, and suppliers. Yesterday headlines were filled with news that Google would have to drop support for Huawei devices meaning that customers would lose access to the Play Store, Gmail, and Google Play Services. Later in the day, news broke that the German supplier Infineon would be suspending shipments to Huawei; trade with Huawei makes up $100 million of Infineon’s yearly revenue.
A slew of other manufacturers were also planning to discuss this week what their relationship with Huawei will be going forward, now they’ll have time to work out their position.
Customers with Huawei devices will be able to carry on receiving updates during the temporary lifting of the ban and hopefully Huawei can work out a permanent solution during this period. However, if it can’t, more people might be ready to replace their Huawei devices by August so they’ll have more time to switch their devices with one which will get updates.
The ideal solution will be for the U.S. and China to work out a solution to the problem but if they can’t, the temporary reprieve will give Huawei, suppliers, and customers more time to prepare for the future.
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