Huawei US Conflict
A Huawei company logo is seen at the Shenzhen International Airport in Shenzhen in Shenzhen (Photo: Reuters / Aly Song)

The trade dispute between the United States and China has now escalated once again following the revelation of a new lawsuit filed against the US Department of Commerce by the Chinese tech firm Huawei.

The Chinese firm had previously filed several complaints against the government in various courts, primarily for the inclusion of the company on the US' trade blacklist. This time, the suit that was reportedly filed late last week involved the company's various 5G equipment that had been detained in the United States and has remained unreturned.

 According to the suit, US officials had detained a shipment of 5G telecommunications equipment that was on its way to being shipped back to China. In 2017, Huawei sent several 5G telecommunications equipment that included a computer server and an Ethernet switch to a laboratory in California for certification testing. Once the certification was completed in September of the same year, the equipment was wrapped up and shipped back to China.

However, the shipment never reached its destination as it was reportedly detained by US government officials in Anchorage, Alaska.

Shortly after the seizure of the equipment, the US Commerce Department contacted Huawei and told them that there would be a delay in the return of the shipment pending an investigation. The agency explained that it needed to check if an export license was needed for the shipment.

Huawei complained in its lawsuit that it had been waiting for almost two years now for a decision from the Commerce Department regarding its equipment.

The Chinese company also revealed that export licenses were not needed for the equipment under the US Export Administration Regulations. In its complaint, Huawei alleges that the US has unlawfully withheld and unreasonably delayed the shipment resulting in an intentional "bureaucratic limbo."  

The withholding of Huawei's equipment has been seen by industry experts as a direct result of the ongoing conflict between China and the United States. US officials could potentially find other excuses to continue to hold Huawei's 5G equipment, which it can use as leverage against the company.

The suit is the latest development in the trade conflict that has now spilled over into the technology sector resulting in a full-blown tech cold war between the United States and China.

Analysts speculate that the US could be increasingly concerned about Huawei's rising 5G capabilities.

The US also currently has a shortage of qualified domestic 5G equipment suppliers, which means that it will likely have to find a way to end its dispute with Huawei if it wants to catch up with China in the race to commercialize 5G technologies.