Microsoft wins license to export to Huawei as US senators protest

Microsoft can now export 'mass-market' software to Huawei, although US senators called for stop to issuing licenses.

    The US Commerce Department said it had received roughly 300 license requests by US firms to trade with blacklisted Huawei, of which about half have been processed and one-quarter of the total approved [File: Hannibal Hanschke/Reuters]
    The US Commerce Department said it had received roughly 300 license requests by US firms to trade with blacklisted Huawei, of which about half have been processed and one-quarter of the total approved [File: Hannibal Hanschke/Reuters]

    Microsoft Corp says it has been granted a United States government licence to export software to China's Huawei Technologies Co Ltd, even as US senators across the political divide are calling for the government to stop handing out such permits.

    "On November 20, the US Department of Commerce granted Microsoft's request for a licence to export mass-market software to Huawei. We appreciate the Department's action in response to our request," a Microsoft spokesman told Reuters News Agency via email.

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    The administration of US President Donald Trump said this week it would allow some suppliers to restart sales to the Chinese telecommunications giant, which was placed on a trade blacklist over national security concerns six months ago.

    Although the Commerce Department confirmed it had begun issuing licences for some companies to sell goods to Huawei, it was not immediately clear which products had been approved for sale. A person familiar with the process told Reuters on Wednesday that some licences for sales of cellphone components and non-electronic components were approved.

    Microsoft declined to comment beyond its statement on which products had been approved, and the Commerce Department declined to comment on the issuance of the license to Microsoft.

    On Wednesday, a US official said it had received roughly 300 licence requests, about half of which had been processed. Roughly half of those - or one-quarter of the total - had been approved and the rest denied.

    Dan Ives, an analyst with Wedbush Securities, said the licence was most likely for the company's Windows operating system.

    "This will be a major relief for Huawei after an arduous period with large technology players like Microsoft, Google and others restricted on the platform," Ives said.

    National security threat

    But a bipartisan group of 15 senators urged the Commerce Department to suspend the issuing of licences, saying it could threaten US security.

    In a letter to Trump on Thursday, the senators said the administration should halt issuing licences until it provides Congress with "a report outlining specific criteria for determining whether or not the approval of any licence poses a national security threat."

    The letter, which was signed by Senate Democratic Leader Chuck Schumer and Republican Senator Tom Cotton and provided to Reuters, demands congressional leaders "be notified prior to the issuance of any licences to US firms to sell components to Huawei and its affiliates".

    It was also signed by Republicans Ben Sasse, John Cornyn, Josh Hawley and Rick Scott and Democrats Elizabeth Warren, Richard Blumenthal, Ron Wyden and Cory Booker.

    In response to the senators, a Commerce Department spokesman said the agency was "issuing these narrow licences to authorize limited and specific activities which do not pose a significant risk to the national security or foreign policy interests of the United States."

    The department added that the licences "were approved through an interagency licence review process" that included Commerce, Defense, State and Energy Department officials.

    The licence approvals came after the department renewed the so-called temporary general licence for the company for a third time on Monday, extending permission for Huawei to engage in limited transactions to assist US rural network operators.

    The Trump administration put Huawei on a blacklist, citing national security concerns in May after trade talks with China broke down. Companies on the list are not allowed to receive shipments of US goods without a special licence from the Commerce Department.

    The Federal Communications Commission plans to vote on Friday to designate Huawei and ZTE Corp national security risks, barring US rural carriers from tapping an $8.5bn government fund to buy equipment or services from them. The FCC also plans to propose requiring those carriers to remove and replace equipment from such designated companies.

    SOURCE: Reuters news agency