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Huawei's US Research Arm Seeks Split From Chinese Parent Firm Amid Blacklisting – Report

© REUTERS / Aly SongA Huawei company logo is seen at CES (Consumer Electronics Show) Asia 2019 in Shanghai, China
A Huawei company logo is seen at CES (Consumer Electronics Show) Asia 2019 in Shanghai, China  - Sputnik International
US President Donald Trump signed an executive order that banned the use of Huawei telecommunications equipment in the country, claiming that it poses an “unacceptable risk to the national security” and citing concerns that the company’s been spying for the Chinese government. Both Huawei and Beijing have denied these allegations.

Huawei’s US-based research and development arm, Futurewei Technologies Inc, has moved to distance itself from its parent company following the Trump administration’s blacklisting of the Chinese tech giant in May, Reuters reported, citing two people familiar with the matter.

The subsidiary has allegedly barred Huawei staff from its offices, moved its personnel to a new IT system and prohibited them from using the corporate parent’s name or logo in communications, an unnamed Futurewei employee claimed. Until now, Futurewei’s staff often identified themselves as Huawei employees since it has no separate brand or a website, sources said.

The Chinese telecom giant will, however, continue to own Futurewei, according to Reuters.

The firm’s General Counsel Milton Frazier reportedly declined to comment, referring questions to Huawei spokesperson Chase Skinner, who did not reply.

Both Huawei and Futurewei have had a long list of research partnerships and grant programmes with American universities. Last year, two dozen members of Congress penned a letter to the US Education Secretary, claiming that Huawei’s partnerships with roughly 50 US universities could jeopardise national security.

They alleged in the letter that Huawei was using those partnerships to carry out research in telecommunications, robotics and AI, which could hypothetically be used in hacking or spying, or give Chinese firms a competitive edge over US companies.

The University of California-Berkeley has allowed researchers to keep cooperating with Futurewei under certain restrictions, having, however, cut all funding and information exchanges with Huawei back in May, according to guidelines provided to faculty by Berkeley research chief Randy Katz.

Personnel and students now can work only with Futurewei staff who are US citizens or legal permanent residents, and agree in writing not to share any sensitive data with Huawei.

According to Reuters, citing a US Commerce Department statement, the agency could not legally place Futurewei on the so-called Entity List like Huawei because it was a US company.

Over the past several months, Huawei has faced allegations that it has been spying through its devices and stealing commercial information on behalf of the Chinese government. Both the tech giant and Beijing have vehemently denied the accusations, maintaining that it is independent of the authorities.

In mid-May, President Donald Trump signed an executive order banning US companies from using telecom gear manufactured by firms considered to be a "national security risk".

The US Department of Commerce subsequently added Huawei and its 70 affiliates to a trade blacklist that bars American businesses from selling components to the Shenzhen-based giant without a government license.

However, shortly thereafter, Huawei was given a 90-day "temporary general" license to allow some firms to continue doing business with the Chinese company.

In late May, China’s Commerce Ministry spokesperson, Gao Feng, reportedly said that Beijing would hit back with its counter-blacklist of “unreliable” foreign enterprises and individuals. The list would purportedly include those who fail to comply with market regulations and substantially damage the legitimate rights and interests of Chinese firms.

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