US reaches deal to keep China’s ZTE in business

Reuters / No Comments Share:
REUTERS

WASHINGTON (Reuters) – The Trump administration told lawmakers the US government has reached a deal to put Chinese telecommunications company ZTE Corp back in business after it pays a significant fine and makes management changes, a senior congressional aide said on Friday.

For in depth analysis of Cambodian Business, visit Capital Cambodia
.

US President Donald Trump appeared to confirm the deal in a tweet late on Friday. “I closed it down then let it reopen with high level security guarantees, change of management and board, must purchase US parts and pay a $1.3 Billion fine.”

The reported deal involving China’s second-largest telecommunications equipment maker ran into immediate resistance in Congress, where Democrats and Mr Trump’s fellow Republicans accused him of bending to pressure from Beijing to ease up on a company that US intelligence officials have suggested poses a significant risk to US national security.

ZTE was banned in April from buying US technology components for seven years for breaking an agreement reached after it violated US sanctions against Iran and North Korea. After ZTE makes a series of changes it would now be allowed to resume business with US companies, including chipmaker Qualcomm Inc.

The deal, earlier communicated to officials on Capitol Hill by the Commerce Department, requires ZTE to pay a substantial fine, place US compliance officers at the company and change its management team, the aide said. The Commerce Department would then lift an order issued in April preventing ZTE from buying US products. ZTE shut down most of its production after the ruling was announced.

Fox News said Mr Trump told them on Thursday that he had negotiated the $1.3 billion fine with Chinese President Xi Jinping in a phone call.

ZTE, which is publicly traded but whose largest shareholder is a Chinese state-owned enterprise, agreed last year to pay a nearly $900 million penalty and open its books to a US monitor. The penalty stemmed from for breaking an agreement after it was caught illegally shipping US goods to Iran and North Korea, in an investigation dating to the Obama administration.

Share and Like this post

Related Posts

Previous Article

Council of Ministers approves two new energy projects

Next Article

Capital welcomes Exchange Square