Commerce Department, ZTE reach deal to lift technology ban

June 8, 2018
U.S. Commerce Department and ZTE have reached a deal that would lift the ban on ZTE’s access to U.S. technology. The 10-year agreement, announced yesterday, requires ZTE to pay $1 billion in fines, put another $400 million in escrow against future potential violations, replace its current senior leadership team and board of directors, and accept and pay for the placement within the company of a team chosen by the U.S. that would monitor and report on ZTE’s compliance going forward. 

U.S. Commerce Department and ZTE have reached a deal that would lift the ban on ZTE's access to U.S. technology. The 10-year agreement, announced yesterday, requires ZTE to pay $1 billion in fines, put another $400 million in escrow against future potential violations, replace its current senior leadership team and board of directors, and accept and pay for the placement within the company of a team chosen by the U.S. that would monitor and report on ZTE's compliance going forward. The team would report jointly to the Commerce Department's Bureau of Industry and Security (BIS) and whomever is named ZTE's new chairman.

The Commerce Department retains the right to re-impose the technology ban if ZTE fails to comply with the new deal's terms. The Commerce Department announcement did not include a timeframe in which ZTE must set all the building blocks of the agreement in place but did say that ZTE must perform the financial transactions before the technology access ban will be lifted. Press reports state that ZTE has 30 days to replace its management and board.

The technology access ban, imposed when the Commerce Department determined this past April that ZTE had violated terms of a previous disciplinary agreement, then lied about it, put ZTE out of operation (see "ZTE halts major operations after ban on access to U.S. components"). The company has not made a public statement regarding the deal or about how long it would take to resume normal operations.

About the Author

Stephen Hardy | Editorial Director & Associate Publisher

Stephen Hardy is editorial director and associate publisher of Lightwave and Broadband Technology Report, part of the Lighting & Technology Group at Endeavor Business Media. Stephen is responsible for establishing and executing editorial strategy across the both brands’ websites, email newsletters, events, and other information products. He has covered the fiber-optics space for more than 20 years, and communications and technology for more than 35 years. During his tenure, Lightwave has received awards from Folio: and the American Society of Business Press Editors (ASBPE) for editorial excellence. Prior to joining Lightwave in 1997, Stephen worked for Telecommunications magazine and the Journal of Electronic Defense.

Stephen has moderated panels at numerous events, including the Optica Executive Forum, ECOC, and SCTE Cable-Tec Expo. He also is program director for the Lightwave Innovation Reviews and the Diamond Technology Reviews.

He has written numerous articles in all aspects of optical communications and fiber-optic networks, including fiber to the home (FTTH), PON, optical components, DWDM, fiber cables, packet optical transport, optical transceivers, lasers, fiber optic testing, DOCSIS technology, and more.

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