China's Huawei building 'secret network for chips', trade group claims

Huawei Technologies Co is building a collection of secret semiconductor-fabrication facilities across China to let the company skirt US sanctions, a Washington-based semiconductor association has warned.

The Chinese tech giant moved into chip production last year and is receiving an estimated $30 billion in state funding from the government, the Semiconductor Industry Association has said, adding that Huawei has acquired at least two existing plants and is building three others.

The US Commerce Department added Huawei to its export control list in 2019 over security concerns. The company denies being a security risk.

If Huawei is constructing facilities under the names of other companies, as the Semiconductor Industry Association says, then it might be able to circumvent US government restrictions to indirectly purchase American chip-making equipment, according to a Bloomberg report.

Huawei has been placed on a trade blacklist in the United States, restricting most suppliers from shipping goods and technology to the company unless they were granted licenses.

Officials have continued to tighten the controls to cut off the company's ability to buy or design the semiconductor chips that power most of its products.