Daily Management Review

US-China Tension Fall Out, Huawei Accuses Partners Fedex, Flex Of Seizing Assets


US-China Tension Fall Out, Huawei Accuses Partners Fedex, Flex Of Seizing Assets
In a latest example, of business ties between companies of the two countries been affected by the United States- China trade tensions, Chinese tech giant Huawei claimed that its delivery former partner - American delivery company FedEx Corp is probably still holding on to 100 packages of the company according to reports. It was also reported that the Chinese tech giant also accused US-listed Flex of seizing its goods.
According to a report published by Chinese state news agency Xinhua reported on Friday, it is suspected by Chinese authorities who are investigating FedEx that the US firm is illegally holding back packages of Huawei. Chinese authorities also accused FedEx of being involved in violation of other laws.
An investigation in FedEx was initiated by Chinese authorities last month after Huawei complained that the US FedEx had intentionally diverted some of its parcels. That incident happened after the US Commerce Department put it on its so called ‘entity list’ essentially blacklisting it and banning all American countries from doing any business with Huawei in May.
"The investigation showed that FedEx was suspected of holding up more than 100 Huawei packages entering China," Xinhua said. "Investigators also discovered clues to other violations of the company."
No immediate comment to the Xinhua news story was available.
It was just a day ago that Huawie alleged that the electronics contract manufacturer Flex had "seized" its goods in China.
The incident is the latest outcome of the ban on Huawei by the US which has not only upended Huawei’s supply chain spread globally – including the US, which is worth about $105 billion in business annually, but has also created confusion among companies and other organizations even outside of the US about whether the US ban also applied on them.
Following the allegations against FedEx by Huawie, the SU based delivery firm had apologized for the multiple incidents of diversion of Huawei packages and had claimed that the incidents had happened because of "operational errors. However it later filed a case in court against the US government for what it said was an "impossible task" to "police the contents" of export shipments.
And on Friday, Huawei complained that goods worth some 700 million yuan or $101.81 million in its China factory were seized by Flex, which was first reported by the Chinese newspaper Global Times which is backed by the Chinese government.
According to the news report, following the blacklisting of Huawei by the US, the assets of Huawei had been kept in its factory in the southern city of Zhuhai by Flex which had resulted in losses sot the Chinese telecom equipment maker. Some 400 million yuan worth of goods had been possible for Huawei to recover after negotiations with Flex, the company told the media. Talks are still being held to recover the rest.
"Flex and Huawei have had a long-standing and successful partnership which has recently been impacted by unforeseen challenges resulting from the US/China trade situation. Both parties are actively working to find a mutually agreeable way forward given these facts," Flex said in an emailed statement to the media.