On March 8, Voice of America (VOA) reported that ZTE Corporation, China’s No. 2 telecom equipment company with extensive overseas operations, agreed to plead guilty and pay a fine of $892 million, as part of the settlement for breaking sanctions and selling electronics to Iran and North Korea. {Editor’s note: In addition to the $892 million ZTE agreed to a penalty of $300 million that will be suspended provided it complies with the agreement.}
VOA cited U.S. Attorney General Jeff Sessions in a Justice Department news release, “This plea agreement holds them accountable, and makes clear that our government will use every tool we have to punish companies that violate our laws, obstruct justice, and jeopardize our national security.”
On March 7, VOA quoted Zhao Xianming, chairman and chief executive of ZTE, as saying, “ZTE acknowledges the mistakes it made, takes responsibility for them and remains committed to positive change in the company.”
China’s Securities Times reported on its website that, at a press conference on March 9, Sun Jiwen, a spokesperson from China’s Ministry of Commerce, urged the U.S. to act properly for the healthy development of bilateral trade relations.
In response to ZTE’s having reached a settlement with U.S. authorities over U.S. export controls and sanctions charges, Sun remarked, “China has always resolutely opposed U.S. sanctions on Chinese companies using its domestic laws, and, in overseas markets, has required Chinese companies to operate in compliance with local laws and regulations.”
Xinhua News Agency mentioned in a dispatch that the U.S. Commerce Department added ZTE on the Entity List under the Export Administration Regulations of March 2016. This has made it difficult for ZTE to acquire U.S. products such as chips and software.
VOA noted that when it was denied US chips and software, ZTE could have faced bankruptcy.
Sources:
Voice of America, March 8, 2017
http://www.voachinese.com/a/chinese-company-20170307/3754038.html
Xinhua News Agency, March 8, 2017
http://news.xinhuanet.com/world/2017-03/08/c_129503736.htm
Securities Times website, March 9, 2017
http://kuaixun.stcn.com/2017/0309/13100764.shtml