Infosys Examines Contracts With Huawei Amid US Sanctions, Others May Follow Suit

India’s second-biggest software services exporter — has started to examine its agreements with Chinese telecom giant Huawei to ensure complying with the US’ restrictions. Analysts are of the view that many Indian information technology (IT) services firms would likely to follow the same move, says an Economic Times report.

It may be noted that the US Commerce Department last month added Huawei, a leader in developing 5G networks, to its so-called ‘Entity List’, which bans the telecom giant to buy and sell hardware, software and services to and from American companies.

The Bengaluru-based IT titan does significant work with Huawei and export controls apply to all individuals and firms that deal with US-origin technology, irrespective of their citizenship, the report mentioned, citing experts. Other Indian IT giants such as Wipro and Cognizant also deal with Huawei, the largest telecom equipment producer in the world.

Infosys has a strategic partnership with Huawei and the company has roped in consultants to ensure it does not violate the US regulations.

“The company has brought in consultants. This is not an easy thing to determine, and it does not mean they have to immediately stop working, but they have to determine where licences may be needed,” an unnamed source familiar with Infosys’ moves told ET.

In November 2018, the US Securities and Exchange Commission (SEC) had quizzed Infosys’ partnership with Huawei, which offers its products in Syria and Sudan, to find out whether the company was indirectly selling software and services to those countries. The Trump administration has imposed curbs and export restrictions on both these countries.

Infosys had conveyed to the SEC that it does not work with Huawei in those countries, the report mentioned.

“In our business with Huawei, we support the Enterprise Business Group of Huawei that conducts business in Mexico, Brazil, Europe, India, Sri Lanka, Bangladesh, Myanmar, China, Australia, New Zealand, Japan, Singapore, Malaysia, and Thailand,” according to the daily which citied Infosys had declared in a filing with the SEC.

Julian Ku, Faculty Director of International Programs, and Maurice A Deane distinguished professor of Constitutional Law at Hofstra University, told the business daily: “Any Indian company that is working with Huawei should at least consult a sanctions law expert to analyze whether the technology they are using or providing to Huawei would trigger US export controls and require a licence.”―Times Now