Monday, 23 April 2018 04:39

ZTE gets chance to present more info to US over ban


Chinese telecommunications equipment maker ZTE has been granted an opportunity to present additional evidence over the export ban imposed on the firm by the US Commerce Department.

A report in The Wall Street Journal said a Commerce Department official had said late on Friday that while ZTE did not have the rights to make an administrative appeal, the additional information would be received through informal procedures shortly.

In the interim, the official said imposing a stay on the sanctions, which mean that American companies cannot supply any components to ZTE, was not appropriate.

The Commerce Department said the ban was imposed because of false statements made by the company during talks in 2016 over a charge of shipping telco equipment to Iran and North Korea. The employees who facilitated these sales were supposed to be fired.

ZTE was fined US$1.19 billion in March 2017 and also agreed to a seven-year suspended export ban which would take effect if it was found to be in violation of the Export Administration Regulations.

Subsequently, the Department of Commerce claims to have found that statements made by ZTE to the department's Bureau of Industry and Security in 2016, during settlement talks, and in 2017 over disciplining the guilty employees, were false.

But, in a statement, ZTE claimed that the ban had been promulgated "ignoring the continuous diligent work of ZTE and the progress we have made on export compliance and disregarding the fact that:

  • "ZTE self-identified the issues in the correspondence and self-reported by ZTE immediately;
  • "the company has taken measures against the employees who might have been responsible for this incident;
  • "corrective measures has been taken immediately; and
  • "a prestigious US law firm has been engaged to conduct independent investigation."

The WSJ said it was unclear as to what kind of additional information ZTE planned to present and whether it would have an effect on the sanctions that have been imposed.

The company said in the statement: "The denial order will not only severely impact the survival and development of ZTE, but will also cause damages to all partners of ZTE including a large number of US companies."

There has been speculation that ZTE, which uses Google's Android mobile operating system for its smartphones, may lose its licence to use the operating system.

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Sam Varghese

Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

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