EXCLUSIVE-U.S. nears rule-change to restrict Huawei's global chip supply -sources

(Adds source saying rule change would apply to newer chips)

By Karen Freifeld and David Shepardson

March 26 (Reuters) - Senior cabinet officials in the administration agreed to new measures to restrict the global supply of chips to China's Huawei Technologies, sources familiar with the matter said, as the White House ramps up criticism of China over coronavirus.

Under the change, foreign companies that use U.S. chipmaking equipment would be required to obtain a U.S. license before supplying certain chips to Huawei. The Chinese telecoms company was blacklisted last year, limiting the company's suppliers.

One of the sources said the rule-change is aimed at restricting the sale of sophisticated chips to Huawei and not older, more commoditized and widely-available semiconductors.

Because most chipmaking equipment used worldwide relies on American technology, the change would represent an expansion of export control authority that some trade experts have said would anger U.S. allies.

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It is unclear if President Donald , who appeared to push back against the proposal last month, will sign off on the rule change.

The decision came when U.S. officials from various agencies met and agreed on Wednesday to alter the Foreign Direct Product Rule, which subjects some foreign-made goods based on U.S. technology or software to U.S. regulations, the sources said.

The U.S. Department of Commerce, which would have a role in enacting any rule change, did not have an immediate comment.

(Reporting by Karen Freifeld in New York and David Shepardson in Washington. Additional reporting by Alexandra Alper and Mike Stone in Washington. Editing by Chris Sanders and Nick Zieminski)

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