Posted on 06/07/2018 7:51:25 AM PDT by SeekAndFind
The U.S. has struck a deal with Chinese telecom giant ZTE to end crippling American sanctions, Commerce Secretary Wilbur Ross told CNBC on Thursday.
The department said the deal includes a $1 billion penalty against ZTE and a U.S.-chosen compliance team.
"We are literally embedding a compliance department of our choosing into the company to monitor it going forward. They will pay for those people, but the people will report to the new chairman," Ross said in a "Squawk Box" interview.
ZTE's latest brush with U.S. regulators came after the company's business dealings with Iran and North Korea violated U.S. trade agreements. ZTE paid $1.19 billion in fines for those violations, but the dispute didn't end there. The Commerce Department then alleged that ZTE misled regulators and failed to discipline the employees responsible for the sanction breach.
The settlement deal includes $400 million in escrow to cover any future violations as well as requiring ZTE to change its board of directors and executive team in 30 days.
"If they do violate it again, in addition to the billion dollars they are paying us up front, we had them put $400 million in escrow. The total deal is $1.4 billion. That money will be forfeited if they violate anything ... and we still retain the power to shut them down again," Ross said.
"This is a pretty strict settlement," he added. "The strictest and largest settlement fine that has ever been brought by the Commerce Department against any violator of export controls."
"This should serve as a very good deterrent not only for them but for other potential bad actors," he added.
(Excerpt) Read more at cnbc.com ...
A $1 Billion penalty for a company with a $110 Billion revenue? Hmmm...
This is a horrible deal for the US.
Take the billion and use it to fund conservative organizations.
There’s another sideline. They buy 25% of their ZTE components from the USA. It’s a win win.
Horrible in what way?
No....they buy 25% of their components from the USA. The sanctions didn’t just hurt China.
They are like Huawei - using their telecom products to spy on US citizens. Also have been involved in sales to Iran. We don’t need them in our markets.
I guess you missed the part where they agreed to install a U.S.-chosen compliance team.
I’m guessing it’s a small part of a larger deal that will be wonderful for the United States...
Yeah, I’m sure that will work...
Yea, The EU did that to apple (Rush was talking about it yesterday). It’s not something any company wants that’s for sure.
ZTE, the Chinese telecommunications company bidding for major contracts in Australia, and at the centre of Donald Trump’s trade war with Beijing, was established partly as a front for military intelligence and has been linked to corruption in 18 countries, according to explosive court documents filed in the US.
“China’s Ministry of Aerospace founded ZTE as a front to send officers abroad under non-diplomatic covers such as scientists, businessmen and executives for the purpose of collecting intelligence,” the documents filed in the 191st District Court of Dallas reveal.
CAUSE NO. DC-10-07052
I’m sorry, but the president is wrong on this. ZTE should be kept out of our markets. They’ve damaged national security and they’ve violated the sanctions on Iran and North Korea. The president has done a lot of good things, but this is a bad decision.
Crumbs.
Or use Patriot Mobile, which donates a portion of your bill to conservative organizations of your choice.
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