With help from John Hendel and Mark Scott

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— Privacy Shield 2.0: The U.S. and EU have unveiled their new transatlantic data deal but some key details won’t be hashed out till next month.

— Huawei is A-OK: U.S. sanctions have hurt the Chinese tech conglomerate, but 5G expansion and innovation in wearables are buoying its bottomline.   

— Agtech to the front: The antitrust agencies are hosting a listening session on food and agriculture as they ponder a merger review revamp — changes that could impact the burgeoning field of agtech.

IT’S MONDAY, MARCH 28. Welcome to Morning Tech! I’m Leah Nylen, your guest host for today. It’s Budget Day! That wonderful day every year when every reporter struggles to remember the difference between budget authority and outlays. (Or maybe that’s just me.)

Your regular MT host, Brendan Bordelon, will be back at the reins tomorrow. But in the meantime SEND ALL THE PET PICS to [email protected] or via Twitter DM to @leah_nylen. Got an event for our calendar? Send details to [email protected]. Anything else? Team info below. And don’t forget: Add @MorningTech and @PoliticoPro on Twitter.

PRIVACY SHIELD 2.0 STILL HAZY — European Commission President Ursula von der Leyen and U.S. President Joe Biden signed a new political agreement for transatlantic data transfers last week. But what exactly are the details? Many EU officials were left scratching their heads — particularly after von der Leyen personally took over the final stages of the talks.

But what is it? A White House statement started to give an idea of what the structure, which still needs to be hammered out, could potentially look like. Washington said it would create a “multi-layer redress mechanism that includes an independent Data Protection Review Court” to allow EU citizens to directly appeal the ways their data was used by U.S. intelligence agencies. U.S. security authorities will only have limited access to Europeans’ data to what is “necessary and proportionate to protect national security,” and those agencies will “adopt procedures to ensure effective oversight of new privacy and civil liberties standards.”

Several officials told MT that negotiators could finish hammering out the details as soon as next month, though European national data protection agencies — and those countries’ lawmakers — would still need to weigh in before a final agreement is finalized. Our POLITICO EU colleagues Vincent and Mark have more on how a provisional Privacy Shield agreement came together after almost two years.

COMPETES UP AGAIN — The Senate is set to take up China competitiveness legislation this evening, replacing the House-passed competitiveness package (H.R. 4521) with its Senate counterpart (S. 1260) and kicking it back to the House. That would start the process of taking the two bills — which each include tens of billions in chip industry subsidies — to a conference committee, where lawmakers will try to hash out a compromise.

BUDGET DAY! Join us today at 3:30 p.m. as our policy reporters, including Morning Money author Kate Davidson, discuss President Joe Biden’s budget request and prospects for fiscal 2023. Register now.

HUAWEI LEANS INTO R&D AMID GLOBAL 5G CRUNCH — Despite tight U.S. restrictions, the Chinese tech giant continues to build out 5G networks in other parts of the globe and expands into smart tech, including wearables and smart screens. Although Huawei has a scarce profile within U.S. borders, the company is today touting record-high net profits of $17.8 billion, out of $99.9 billion in revenue, in an annual report shared with MT.

— “We are more capable of dealing with uncertainty,” said Huawei chief financial officer Meng Wanzhou, who’s back in action after resolving her three-year extradition fight with the U.S. in September. Huawei is pledging to up its R&D spending going forward.

— Sanction crunch: Still, Huawei officials acknowledge that U.S. sanctions imposed under the Trump administration have put a damper on parts of the business, as have struggles around getting the right semiconductor chips. “Certainly the sanctions, that’s not a good thing — that obviously hurts,” Paul Scanlan, chief technology officer for the Chinese giant, told reporters Thursday during a roundtable. “What we have done is we’ve spent a lot of time focusing our core R&D on alternatives.”

The Biden administration has largely maintained the Trump administration’s antagonism to Huawei. U.S. officials contend the company is beholden to Beijing, that its equipment poses security threats and that it has stolen U.S. trade secrets. The FCC is currently running a subsidy program aimed at stripping Huawei gear from the handful of U.S. rural telecom carriers that rely on it.

Scanlan said the Chinese government’s embrace of 5G’s industrial use cases — such as in hospitals and manufacturing — “has buoyed up our numbers significantly.” Huawei’s efforts involving other telecom components like antennas have also helped bolster the company, he added, as have some 5G efforts in parts of Latin America, the Middle East and Asia.

— Eyes on Russia: Like many Chinese companies, Huawei has so far avoided taking sides amid Russia’s ongoing invasion of Ukraine, and still does business in both countries. This precarious dynamic is fueling chatter about possible secondary sanctions that could hit Chinese companies, which we’ll be watching.

SPEAKING OF TELECOM SECURITY — FCC Chair Jessica Rosenworcel on Friday slapped a trio of new companies onto the agency’s list of communications equipment and services that the government thinks pose a security threat: AO Kaspersky Lab, headquartered in Moscow, as well as China Telecom Americas Corp. and China Mobile International USA Inc. None are particularly shocking, given the security concerns raised for years around these firms.

— This update expands the original list the FCC published last year, which included companies like Huawei and ZTE. The agency created the tally in response to a 2020 law and coordinated the update in tandem with the executive branch.

“I am confident that we will have more entities to add to our Covered List,” said GOP Commissioner Brendan Carr, who applauded the expansion, in a statement. On Friday, Rep. Claudia Tenney (R-NY) called specifically for adding Chinese drone-maker DJI.  

AGTECH: THE NEXT FRONTIER — The Federal Trade Commission and Justice Department will hear from farmers, ranchers, grocers, restaurateurs and others today on how mergers have affected the food and agriculture industries, ahead of the agencies’ planned revamp of merger guidelines. That new guidance, expected later this year, could play a key role in the future of emerging technology focused on improving farming.

Agtech trends: Population growth and climate change are two of the biggest drivers in agriculture technologies, a sector that saw a record $10.5 billion in investment last year, according to a report last week from research company PitchBook. The majority of startups — about 60 percent — are based in North America, with ag biotech (technology used to improve crop or animal yields) and precision ag (farm robotics) among the areas with the most growth.

Both of those segments, though, have their own giants, several of whom have gotten bigger through mergers in the past decade. For example, the U.S. leader in farm equipment is John Deere — a company farmers have pushed the FTC to scrutinize over its restrictive repair practices. Deere made one of the biggest agtech deals last year when it bought Bear Flag Robotics, which specializes in retrofitting farm equipment with autonomous driving ability.

Startup acquisitions under scrutiny: Since Facebook’s $1 billion acquisition of Instagram in 2012, antitrust regulators have become more cautious about big players buying startups. Assistant Attorney General Jonathan Kanter pledged in January to pay particular attention when the biggest companies are seeking to expand via mergers.

DirecTV is launching an external affairs team under general counsel and external affairs chief Michael Hartman, to be led by DirecTV senior vice president Stacy Fuller. Also on the team: Dan Walsh, VP of external affairs overseeing federal legislative matters; Brenna Sparks, associate VP of external affairs managing federal regulation; Hamlin Wade, associate VP of external affairs leading state legislative advocacy; Scott Alexander, senior director, leading U-verse franchising regulations and agreements; and Becca Smith, manager, formerly of AT&T.

ICYMI: POLITICO EU’s Sam Stolton and I teamed up on Friday to explore the United States’ continuing dilemma on the EU’s landmark digital gatekeeper rules.

Crowd-sourcing cold cases: The NYT explores how crowdfunding is helping forensic genealogy firms use DNA testing to help solve unsolved murders and crimes.

Pichai sighting: Alphabet CEO Sundar Pichai is set to meet with EU competition czar Margrethe Vestager this week, Reuters reports.

Tips, comments, suggestions? Send them along via email to our team: Heidi Vogt ([email protected]), Konstantin Kakaes ([email protected]), Emily Birnbaum ([email protected]), Brendan Bordelon ([email protected]), John Hendel ([email protected]), Rebecca Kern ([email protected]) and Leah Nylen ([email protected]). Got an event for our calendar? Send details to [email protected]. And don’t forget: Add @MorningTech and @PoliticoPro on Twitter.

Have a great day!