ZTE Sings An Agreement To Restart Its Operations In The US Market


ZTE Sings An Agreement To Restart Its Operations In The US Market

Andrew Cummings
June 9, 2018

In April, the U.S. Commerce Department banned ZTE from buying parts from American suppliers after the company was found to have falsely informed the U.S. government that it had disciplined employees responsible for violations that led to a settlement a year ago. It's important to note that this deal is not confirmed, with Commerce Department spokesman James Rockas saying that "no definitive agreement has been signed by both parties".

The sources requested anonymity because they were not authorized to publicly discuss the matter.


China's ZTE will pay a $1 billion penalty and will embed a US -appointed compliance team, terms that are similar to those President Trump discussed last month when he revealed that Chinese leaders had asked him to look into the matter. "It's unprecedented to have USA agents as monitors ..."

In case you haven't been following along, ZTE previously agreed to certain conditions back in March 2017 after they were found to have ignored US sanctions and shipped products to both North Korea and Iran. Not only that, but the entire board and executive teams must be fully replaced within 30 days from the time of signing the agreement.


ZTE had been banned from buying American technology components for seven years, a penalty that industry analysts said would put it out of business within weeks because of its reliance on the United States for parts.

U.S. President Donald Trump arrives for a welcoming ceremony in Beijing, China, November 9, 2017. Senator Marco Rubio (R-FL) has floated a proposal for Congress to block this sort of deal. ZTE was initially asked to cease operations of main business due to U.S sanctions. These penalties come on top of the millions ZTE has already paid to the USA under its 2017 settlement. Shenzhen-based ZTE has a subsidiary in Richardson, Texas. Under the terms of its guilty plea, ZTE paid $890 million in fines, and agreed to fire some senior staff, and strip bonuses from 35 others. You see, the company has been flourishing in the United States as the fourth biggest phone maker only to be sanctioned for lying to the U.S. government for violating laws that must be followed in relation to transactions with North Korea and Iran.


And last week, the Daily Beast reported that a day after the president said he wanted to help ZTE, the tech company hired the Mercury Public Affairs firm to lobby on its behalf in Washington. The ban also hurt American companies that supply ZTE.

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