According to The Wall Street Journal, the move will enable the agency to require licenses from chip factories across the world if they want to use US equipment to manufacture chips for Huawei.
US industry participants, however, told the newspaper that the measure could deal a blow to the global supply chain for semiconductors and backfire on American companies themselves.
There is reportedly no unanimity on the matter in the US administration, with President Donald Trump yet to review the proposed measures. The newspaper, meanwhile, recalled that the president wanted to allow US companies to sell their equipment to Huawei if this did not threaten US national security.
The United States accuses Huawei of collaborating with the Chinese military and intelligence and using its equipment for illegal surveillance purposes, something that the company refutes as unjustified, politically motivated and anti-competitive practices.
In May, Washington blacklisted Huawei and about 70 of its affiliates from purchasing US technology and doing business with US companies without relevant government authorization. It has since delayed a full-scale trade ban on Huawei several times, most recently on 18 November.
