Trump order bans US firms from dealing with Huawei

In a move that will likely add fire to the growing trade war between the US and China, President Trump has declared a “national emergency” to protect US communication networks.

The President's executive order gives the federal government the power to bar American companies from doing business with foreign suppliers that could pose a threat to national security such as the Chinese firm Huawei.

The order authorizes the commerce secretary to block any transaction involving communication technologies built by companies controlled by a foreign adversary that puts US security at “unacceptable” risk or poses a threat of espionage or sabotage to US networks.

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The decision to block foreign suppliers from providing their technology to US firms over security concerns has been in the pipeline for almost a year. According to one official, the National Economic Council had blocked the move for months but finally dropped its objection once trade talks between the US and China reached an impasse.

Trump's executive order

President Trump's executive order did not go as far as to name any companies or countries specifically but it will likely do the opposite of improving relations between the US and China.

The US has tried repeatedly to convince its allies and partners in Europe to bar Huawei's technology from being used in their 5G networks to no avail but an official ban may be able to convince them otherwise.

The order is broad in nature and does not apply to any technology specifically but instead it covers a wide range of information communications technologies. However, according to officials and analysts, this could lead to legal challenges from companies who believe the order is overly broad.

The commerce secretary will have to develop an enforcement regime under the new order and they would also be permitted to name companies or technologies that could be barred. The order would also permit the secretary to control the timing and manner of how US companies would cease using equipment from barred foreign suppliers.