Trump Administration Lifts ZTE Ban -- Partially, for Now
Xu Wei
DATE:  Jul 04 2018
/ SOURCE:  Yicai
Trump Administration Lifts ZTE Ban -- Partially, for Now Trump Administration Lifts ZTE Ban -- Partially, for Now

(Yicai Global) July 4 -- The US has temporarily lifted part of its ban on technology sales to ZTE, China's second-largest telecoms equipment maker, possibly signaling an easing in trade tensions between the world's two biggest economies.

Until Aug. 1, the commerce department will allow US suppliers to fulfill orders that the Shenzhen-based company placed before the ban started in April, Chinese state broadcaster CCTV reported. The department did not say if or when the rest of the seven-year denial order would be canceled.

The month-long reprieve will support existing product lines related to network equipment and smartphones. But ZTE will not be allowed to place new orders beyond these lines.

US President Donald Trump tweeted in May that he is working with Chinese President Xi Jinping to give ZTE a "rapid way to resume business," and has instructed his commerce department to "complete this matter."

Against the backdrop of the trade standoff between China and the US, ZTE reached a deal with the Trump administration last month. In return for an end to the ban, the company and its affiliates agreed to pay a fine of USD1 billion, set aside another USD400 million in an escrow account, and change its board of directors and senior management. The company cleared out its management last week.

The company uses chips and other key components from the States and it quickly ran out after the commerce department prohibit sales to the firm, claiming ZTE made false statements to the Bureau of Industry and Security in 2016 and 2017 by failing to take punitive measures against employees involved in the illegal export of US products to Iran in March 2016.

Editor: Emmi Laine

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Keywords:   US,ZTE,Donald Trump,Telecom,IPR,Trade,Trade War,Sanctions,Selling Ban,Chips,Semiconductor