United States ban 'extremely unfair, unacceptable': ZTE

21 April, 2018, 04:29 | Author: Darnell Patrick
  • ZTE will face a significant challenge with up to 30 per cent of its smartphones manufactured with U.S.-sourced components

Earlier this week, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) banned American companies from selling telecommunications equipment to ZTE after the firm allegedly did not live up to the terms of an agreement that had been worked out after it illegally shipped telecom equipment to Iran and North Korea.

However, as the DOC enacted the ban because ZTE did not reduce bonuses and failed to reprimand 35 key employees by the deadline they were given, the company may not have much of a leg upon which their argument can stand. ZTE is crying foul and saying that the DOC is being unfair in its action and activated the ban without gathering facts.

Consumer activists and technology experts are advising consumers to hold off on buying Android handsets from China's ZTE until the company clarifies whether us sanctions against the company prevent it from providing operating system updates for its devices.

Jamie Court, president of Los Angeles-based advocacy group Consumer Watchdog, called on ZTE, Google and carriers to tell consumers how the ban will impact their ability to service the Chinese company's phones. It also noted the USA agency that conducted the investigation imposed the new ban "even before the completion of investigation of facts, ignoring the continuous diligent work of ZTE and the progress we have made on export compliance".

Aside from illicit distribution of American resources, the U.S.is also accusing ZTE of lying to officials, "and obstructing justice including through preventing disclosure to and affirmatively misleading the U.S. Government". The Chinese company claims that they spent over United States dollars $50 million in export control and compliance a year ago.

The trade body said the action against ZTE came "at a sensitive moment" in Sino-U.S. trade relations and so it can not be ruled out that the United States is seeking to exert pressure on China through sanctions against ZTE.


The company said it continue to pursue a solution through communication, but will also seek to protect its "legitimate rights and interests through all legal means" to protect its employees, shareholders and fulfil obligations to global customers, partners and suppliers.

Established in 1985, ZTE provides technology and products to clients in more than 160 countries and regions.

"The US is thinking and acting like a bully - only it can have high tech and others cannot".

The government expects local chips to take up 40 percent of the market in 2020 and 70 percent in 2025.

ZTE will increase R&D investment, Yin said.

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