Home > News content

The U.S. announces details of the ZTE settlement agreement and will lift the ban after paying the money

via:博客园     time:2018/6/12 10:01:31     readed:402


Original title: U.S. reveals ZTE settlement details, ban still in place

On June 12, according to Reuters, the US Department of Commerce announced details of its settlement agreement with ZTE on Monday after ZTE agreed to pay a fine of US$1 billion, reorganize its leadership, and meet other conditions. The agreement will allow ZTE to resume business with U.S. suppliers.

However, the U.S. Department of Commerce stated that the ban on the purchase of U.S. spare parts by ZTE in April this year will not be immediately lifted until the company actually pays a fine and deposits US$400 million in custody funds to its designated bank.

ZTE’s survival was once threatened by the US Department of Commerce’s ban. On Thursday, it received the “Help” solution from the Trump administration.

On Sunday, White House trade adviser Peter Navarro said that due to the private friendly relationship with Chinese leaders, Trump agreed to lift the US Commerce Department’s ban on ZTE.

According to a 21-page order signed by the U.S. Department of Commerce on June 8, ZTE must restructure the board of directors of its two corporate entities within 30 days. On Monday, the order was announced on the U.S. Department of Commerce’s website along with the settlement agreement with ZTE.

According to this order, members of the leadership of ZTE's senior vice president level and above, as well as any executives or officials involved in misconduct, must be dismissed.

Last year, ZTE acknowledged that it had conspired to circumvent the embargo imposed by the United States and sold equipment containing U.S. parts to Iran. The U.S. Department of Commerce’s ban on ZTE’s purchase of U.S. parts was implemented after the company stated that it wanted to punish some senior executives who were responsible for violations but did not actually punish them. After the U.S. Department of Commerce issued a ban, ZTE stopped its main business operations.

Under the settlement agreement, ZTE will pay a total of US$1.7 billion in civil fines, including US$361 million, US$1 billion in fines already paid as part of the March 2017 agreement, and US$400 million to be deposited into a third-party hosting account.

This $400 million will be kept in a U.S. bank account for 10 years. If ZTE fails to comply with the agreement, the money will be paid to the U.S. Department of Commerce. After 10 years, if there is no violation of ZTE, this $400 million will be returned to ZTE.

According to the U.S. Department of Commerce’s order, ZTE must provide the U.S. Department of Commerce with details of the Chinese government’s ownership of ZTE’s ownership and control, including public and private shares.

The U.S. Department of Commerce will also select a monitoring agency named “Special Compliance Coordinator” within 30 days to report on the compliance of ZTE and its global subsidiaries over the next 10 years. The coordinator will have at least six employees who will be funded by ZTE.

Last year, the federal court in Texas of the United States appointed ZTE an independent compliance ombudsman for a three-year term. Under the settlement agreement, ZTE also agreed to allow the U.S. government to more easily verify the company's shipment of regulated products.

In addition, ZTE must publish data on the use of US parts in its products in Chinese and English on its website within 180 days.

ZTE will not allow any action or make any public statements on the orders of the US Department of Commerce and the settlement agreement reached with it, or even indirectly denounce any allegations.

U.S. congressmen have been attacking the settlement agreement and plan to overturn it through legislation. They cited a warning from the U.S. intelligence agencies that ZTE poses a threat to U.S. national security.

Earlier this week, the U.S. Senate will vote on legislative proposals intended to stop the settlement agreement, including an amendment to the U.S. Defense Policy Act.

China IT News APP

Download China IT News APP

Please rate this news

The average score will be displayed after you score.

Post comment

Do not see clearly? Click for a new code.

User comments