ZTE, Chinese Telecom Company, Denied Export Privileges Because of Sales to Iran, North Korea
The Bureau of Industry and Security denied for seven years the export privileges of Zhongxing Telecommunications Equipment Corporation, of Shenzhen, China and ZTE Kangxun Telecommunications Ltd. of Hi-New Shenzen, China (ZTE). The companies had previously agreed to a combined civil…
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and criminal penalty and forfeiture of $1.19 billion and a seven-year suspended denial, because of its sales of telecom equipment to Iran and North Korea, and misleading the U.S. government about those sales. The denial, announced April 16, is because ZTE paid bonuses to employees involved in the sales and did not reprimand them, as they had claimed they were doing. The order says that "BIS is left to conclude that if the $892 million monetary penalty paid pursuant to the March 23, 2017 order, criminal plea agreement, and settlement agreement with the Department of the Treasury did not induce ZTE to ensure it was engaging with the U.S. government truthfully, an additional monetary penalty of up to roughly a third that amount ($300 million) is unlikely to lead to the company's reform."