A group of US lawmakers is pressing the Trump administration to shut down a semiconductor export channel they say Huawei has been exploiting to bypass American sanctions. But the agency responsible for enforcing those export controls insists the alleged loophole does not exist.
The alleged workaround
In a letter sent this week, members of the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party argued that Huawei has been obtaining advanced chips through a third-party arrangement. The lawmakers claim the company is using a network of intermediaries to acquire semiconductors that would otherwise be blocked under US export restrictions aimed at curbing China's technological military advances.
The letter specifically points to a mechanism they describe as a “loophole” that allows Huawei to sidestep the Commerce Department’s Entity List. The representatives are calling on the administration to immediately close that path and to impose stricter licensing requirements on any firm that might be facilitating the transfers.
Agency pushes back
The Bureau of Industry and Security (BIS), the Commerce Department unit that oversees export controls, responded by saying it is not aware of any such loophole. In a statement, a BIS official said the agency “continuously monitors compliance” and that current rules already cover the scenario the lawmakers described. The official added that if new evidence emerges, BIS will act, but for now it sees no gap in the regulations.
The denial puts the bureau at odds with the lawmakers, who say they have intelligence briefings and industry reports that point to a persistent evasion strategy. The lawmakers did not release specific evidence, citing classified sources.
What’s at stake
Huawei has been under US trade restrictions since 2019, when it was added to the Entity List over national security concerns. The company has repeatedly denied violating US laws and says it operates within all applicable regulations. Still, Washington has tightened controls over the years, especially on advanced semiconductors used in artificial intelligence and telecommunications.
The latest push comes as the Biden administration considers additional export curbs on chipmaking equipment and AI chips. Some industry groups have warned that overly broad restrictions could hurt American companies more than they hurt Huawei. The lawmakers, however, argue that any gap in enforcement undermines the entire sanctions regime.
For now, the Commerce Department says it has no plans to change its rules based on the lawmakers' request. The letter remains unanswered by the White House. The next step could be a formal hearing where the agency is asked to explain its position in detail.
