US govt staff told to treat Huawei as blacklisted

WASHINGTON, July 03 (Reuters): A senior US official told the Commerce Department's enforcement staff this week that China's Huawei should still be treated as blacklisted, days after US President Donald Trump sowed confusion with a vow to ease a ban on sales to the firm.

Trump surprised markets on Saturday by promising Chinese President Xi Jinping on the sidelines of the G20 summit in Japan that he would allow US companies to sell products to Huawei Technologies Co Ltd.

In May, the company was added to the so-called Entity List, which bans American firms from selling to it without special permission, as punishment for actions against US national security interests.

Trump's announcement on Saturday - an olive branch to Beijing to revive stalled trade talks - was cheered by US chipmakers eager to maintain sales to Huawei, the world's largest telecoms equipment maker and a key US customer.

But Trump's comments also spawned confusion among industry players and government officials struggling to understand what Huawei policy he had unveiled.

In an email to enforcement staff on Monday that was seen by Reuters, John Sonderman, Deputy Director of the Office of Export Enforcement, in the Commerce Department's Bureau of Industry and Security (BIS), sought to clarify how agents should approach license requests by firms seeking approval to sell to Huawei.

All such applications should be considered on merit and flagged with language noting that "This party is on the Entity List. Evaluate the associated license review policy under part 744," he wrote, citing regulations that include the Entity List and the "presumption of denial" licensing policy that is applied to blacklisted companies.

He added that any further guidance from BIS should also be taken into account when evaluating Huawei-related license applications.

Huawei told Reuters earlier on Wednesday that founder and CEO Ren Zhengfei had said Trump's statements over the weekend were "good for American companies".