What you need to know

  • Huawei has dropped its lawsuit against the U.S government after it agreed to return equipment that was seized in 2017.
  • The equipment has been detained for the past two years for "unidentified export violation concerns."
  • After filing the lawsuit on June 21, 2019, the U.S. determined in August the equipment did not require an export license and will be shipping the equipment back to China.

On September 10, Huawei put out a statement that it was dropping a lawsuit against the U.S. government after the release of its confiscated equipment. The equipment in question included computer servers, Ethernet switches, and other telecommunications gear that was sent to U.S. for commercial testing and certification back in 2017.

The equipment was originally sent to California and was later confiscated in Alaska on its way back to China in September 2017 by the U.S. Commerce Department, citing "unidentified export violation concerns."

Despite many requests from Huawei over the past two years, "the U.S. government failed to make a decision on whether an export license was required for the equipment to be shipped back to China, and continued to hold it."

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That finally prompted Huawei to file a lawsuit against the U.S. Commerce Department and government agencies on June 21 of 2019. The lawsuit cited that the:

Actions by the US Government violated the Constitution and the Administrative Procedures Act, among others.

The lawsuit appears to have worked, because it took less than a month for the U.S. to inform Huawei Technologies USA that its investigation concluded, "no export license was required for shipment to China, and Huawei had complied with the Export Administration Regulations when attempting to ship the equipment back." Now, the equipment will be shipped back to China on the U.S. government's dime.

Even though Huawei's equipment will now be returned after two years, the company is still requesting the U.S Commerce Department to "explain fully why it detained the equipment in 2017, why it decided to release it now, and why it took almost two years to recognize that the equipment's detention was not justified. Thus far the government has refused to explain."

Huawei has a lot of questions and it should, but so far the U.S. government has been less than forthcoming with any answers. Dr. Song Liuping, Huawei's chief legal officer, sees this as a de facto victory with the return of Huawei's equipment. However, Dr. Song warns other companies about doing business with the U.S., stating:

Arbitrary and unlawful government actions like this – detaining property without cause or explanation – should serve as a cautionary tale for all companies doing normal business in the United States, and should be subject to legal constraints.

Despite the bittersweet ending to this legal battle, Huawei and the U.S. still remain at odds since the Chinese tech giant was placed on the U.S. entity list back in May. Since then, the U.S. has extended the deadline, but Huawei has still been restricted by what U.S.-based hardware and software it is allowed to use in its products — Something that could have a big impact on the release of its next-generation phones like the Mate 30.

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