The tension between the US and China, which has led to the “ban” against some brands, seems to slowly wane. He can, therefore, breathe a sigh of relief from ZTE, which was in effect the company most affected by the ban imposed by the Trump administration. The US president himself had decided to engage himself because the situation for the brand had become very heavy.
Now the agreement between ZTE and the US Department of Commerce seems to have been reached, which would allow China’s second largest telecommunications equipment manufacturer to resume business with US suppliers. The announcement of the renewed agreement was made public on Monday – the company has agreed to pay a very high fine for having sold to Iran some components made in the United States.
One detail that prompted the US administration to enforce ZTE’s ban on buying US shares – a provision that will not be revoked until the company pays the fine and will deposit $400 million in collateral in a US-approved bank.
The White House commercial adviser, Peter Navarro, said on Sunday that President Donald Trump accepted the lifting of the ban as a personal favor to the president of China.
ZTE must replace the boards of directors of two corporate entities within 30 days, according to a 21-page order signed on June 8 and published on Monday on the Commerce Department’s website together with the agreement between the parties.
ZTE is also called to replace all members of the leadership, held responsible for the violation found by the US – last year, in fact, the Chinese company has pleaded guilty to having circumvented US embargoes by selling American equipment to Iran.
Under the agreement, ZTE will pay a total penalty of $1.7 billion, or the 361 million already paid as part of an agreement signed in March 2017 and $1,400,000,000 that will go as collateral.