ZTE fined $1 billion


Moreover, the U.S. Commerce Department is expected to count the $361 million ZTE paid previous year as part of a settlement agreement, which will allow the government to claim no less than $1.7 billion in penalties.

The agreement includes a $1 billion penalty for ZTE and another $400 million in trust to cover future possible violations.

The fine announced Thursday comes on top of $892 million ZTE already has paid for breaking US sanctions by selling equipment to North Korea and Iran.

The May ban came after the government determined that ZTE violated terms of its 2017 settlement by failing to fire employees involved with illegally shipping USA equipment to Iran and North Korea.

ZTE was originally posted on to the Denied Persons List in April 2018, when it was announced that the USA had banned the company from purchasing parts from United States companies, such as Alphabet's (NASDAQ:GOOG) Google and Qualcomm (NASDAQ:QCOM). The government will suspend the 10-year ban but it can activate the ban if there are any violations.

U.S. President Donald Trump met with his trade advisers on Tuesday to discuss China's offer to import an extra $70 billion of American goods over a year in hopes of defusing a potential trade war between the world's two largest economies.

ZTE also wanted to be more present in the American smartphone market, but the April shutdown had complicated that plan.

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Over the weekend, ZTE signed the agreement drawn up by the United States, the sources said, but the amended settlement has not been signed.

Ross, speaking about the agreement on CNBC on Thursday, said he did not think the arrangement would have any effect on tariff talks with China. One of China's largest telecommunications companies is back on its feet today, thanks to a deal with the USA government.

ZTE has pledged to fire four senior employees and discipline 35 others as a result of the guilty verdict it received in a Texas court where one of its subsidiaries are based. The US Commerce Department is also appointing watchdog officers to monitor ZTE's compliance with US export laws for the next decade. He later tweeted that the ZTE talks were "part of a larger trade deal" being negotiated with China.

The US has chose to lift the tech ban on Chinese telecom giant ZTE in return for a US$1.4bn settlement and several other compliance measures. The company already has a US court-appointed monitor.

Commerce Secretary Wilbur Ross told CNBC this morning that the US has struck a deal to lift sanctions on the electronics giant.

And last week, the Daily Beast reported that a day after the president said he wanted to help ZTE, the tech company hired the Mercury Public Affairs firm to lobby on its behalf in Washington. Qualcomm and Intel count ZTE as a customer, as do smaller component makers Oclaro and Acacia, both of which saw their stock prices drop sharply when the ZTE export ban was announced. The US government will receive up to $1.7 billion in fines as part of the settlement.