US chipmakers lobbied hard to ease Huawei trading curbs

President Donald Trump’s decision to allow US companies to continue selling to Huawei followed an extensive lobbying campaign by the US semiconductor industry that argued the ban could hurt America’s economic and national security.

In multiple high-level meetings and a letter to the commerce department, the companies argued for targeted action against Huawei instead of the blanket ban the Trump administration imposed in May. That includes identifying specific technologies that the Chinese company shouldn’t be given access to, while allowing US firms to supply the rest.

The Semiconductor Industry Association (SIA), a trade group that represents companies like Intel, Broadcom and Qualcomm, told the Trump administration that its sanctions against the Chinese company will make them appear to be undependable partners, which will put them at a severe disadvantage globally.


Representatives of chipmakers last month met with commerce secretary Wilbur Ross and treasury secretary Steven Mnuchin to argue that the decision to place the company on a so-called entity list could hurt the country, people familiar with the meeting said.

China's semiconductor imports surge
In the letter seen by Bloomberg News, SIA said that the action risked cutting off its members from their largest market and hurting their ability to invest. At the same time, Huawei would in many cases be able to get components elsewhere, they argued.

“Overly broad restrictions that not only constrain the ability of US semiconductor companies to conduct business around the world, but also casts US companies as risky and undependable, puts at risk the success of this industry, which in turn impacts our national security,” the group wrote last month. They added that the administration should take into account those factors when evaluating license applications from American firms.

Their talking points seem to have found their way to Trump. After concluding a high-stakes meeting with Chinese President Xi Jinping in Osaka on Saturday, the US president said American firms weren’t pleased with his Huawei policy and announced that he has agreed to let them keep shipping some of their components and technology.

“I’ve agreed — and pretty easily — I’ve agreed to allow them to continue to sell that product so American companies will continue,” the president said during a press conference. “The companies were not exactly happy that they couldn’t sell because they had nothing to do with whatever was potentially happening with respect to Huawei. So I did do that.”

He later clarified he will only allow them to sell “equipment where there is no great national emergency problem with it,” without offering more details. Trump’s comments stoked confusion among industry and analysts and the White House has not yet announced specifics on the path forward for US companies doing business with Huawei.

While China hawks in Congress and Trump’s administration feared a potential reversal of the export ban, US industry has been pushing the White House to ease restrictions that require American firms to get a US government license in order to sell to the Chinese tech giant.

A spokesman for SIA said the group has “consistently urged the administration to advance US semiconductor leadership as it works to preserve national security, and we’re encouraged by the direction the president set in Osaka.”

A commerce spokesman said companies can submit license applications explaining the importance of exports on their business relationship. When a case is made for license approval based on concrete and supportable facts, decisions on those licenses are made.