- Google most certainly can restrict how its products are used, in fact they do. Licensing comes with rules.
- Huawei is “free” to use AOSP, but can’t use Google’s APIs. See how far they got with that. No App Store and no Google APIs means a lot of apps won’t work. So you really need Google’s version unless you’re in China.
I don't think that's the main reason why Huawei cannot make phones. Sure in International markets it's an issue. But Oppo, Vivo, Xiaomi and other phones sold in China also don't have Google Play and Play Services.
> unless you’re in China.
You sell in China, you don’t need Google’s approval. Outside it you most certainly do.
No Play Store; alternative app stores exist. This can work; consider Amazon's Android devices which only support Amazon as their store.
Huawei has only been blocked from dealing with the US, but as a result it’s been killed around the world after being one of the leading low-cost brands. Why? No Google.
Take out the Play Store and Play APIs and now you’re just a random Chinese Android manufacturer.