The US Commerce Department has paved the way for US companies to work with Huawei on developing 5G standards, despite rules that prohibit the Chinese telecom giant from doing certain commercial transactions with American firms. The amended rules are applicable "in legitimate standards development contexts only, and not for commercial purposes," the US Commerce Department said on Monday.

"The United States will not cede leadership in global innovation. This action recognizes the importance of harnessing American ingenuity to advance and protect our economic and national security," US Commerce Secretary Wilbur Ross said in a statement. "The Department is committed to protecting US national security and foreign policy interests by encouraging US industry to fully engage and advocate for US technologies to become international standards."

Alleging that China could use Huawei technology for spying purposes, the US government added the company to the Entity List on May 16, 2019, to limit Huawei's access to US technology.

New Rules

Huawei
Picture for Representation Reuters

New export control rules announced last month prevent chip-makers that use US technology and software in chip design from shipping to Huawei without permission of the US government. In its statement on Monday, the US Commerce Department said that the amendment is "meant to ensure Huawei's placement on the Entity List in May 2019 does not prevent American companies from contributing to important standards-developing activities despite Huawei's pervasive participation in standards-development organizations."

"In amending the Huawei Entity Listing, the rule promotes US national security and foreign policy interests by facilitating US leadership in standards development bodies," it added.

International standards serve as the critical building blocks for technological development by enabling functionality, interoperability, and safety. With its focus on research and development, Huawei has emerged as a global leader in developing 5G standards.