Back in April, US Govt has banned ZTE for violating the terms of a sanctions settlement. The company was caught illegally shipping goods to Iran, the U.S said the officials. ZTE then responded and said the verdict is unfair and threatens the survival. However, Earlier this month, American President Donal Trump Tweeted and pledged to reverse course saying that President Xi of China and him are working together to give ZTE a way to get back into the business, fast.
Senator Schumer and Obama Administration let phone company ZTE flourish with no security checks. I closed it down then let it reopen with high level security guarantees, change of management and board, must purchase U.S. parts and pay a $1.3 Billion fine. Dems do nothing….
— Donald J. Trump (@realDonaldTrump) May 25, 2018
…but complain and obstruct. They made only bad deals (Iran) and their so-called Trade Deals are the laughing stock of the world!
— Donald J. Trump (@realDonaldTrump) May 25, 2018
This move from President Trump drew criticism from many government officials as this was the second time ZTE broke US law. However, Trump in a series of Tweets announced course action for ZTE to get the ban lifted. The company now requires purchasing U.S. parts; this move is confusing since the company purchases several US-made components, including Qualcomm processors and Intel-made modems. In fact, it is the inability to import these parts that put the company in this situation.
Furthermore, the company will also need to pay a$1.3 Billion fine and a change of management and board. ZTE is still being accused by the federal government for spying on users, and the recent discovery of malware on some of the company’s devices. Congress could still potentially block Trump’s move with a new law and the Senate’s pending National Defense Authorization Act includes a provision that would make rolling back the ZTE ban difficult.