Tuesday, 25 September, 2018

Bipartisan Senate effort aims to override Trump’s deal to save ZTE

Senators Move To Reverse Trump's Deal Lifting Sanctions On China's ZTE Senate sets vote to make the export ban against ZTE the law of the land
Russell Knight | 13 June, 2018, 12:26

"While the nightmare is now over, ZTE will likely have to deal with many changes", Jeffries said in a research report, adding that it expects significant near-term selling pressure on the company's shares.

USA lawmakers have attacked the agreement and planned legislation to roll it back, citing intelligence warnings that ZTE poses a national security threat.

But the ban on buying US parts, imposed by the department in April, will not be lifted until ZTE pays fines and places $400 million more in an escrow account in a USA -approved bank.

The entire boards of directors of ZTE Corp. and ZTE Kangxun will be replaced within 30 days of the agreement dated June 7, and all members of senior leadership at or above the senior vice-president level and employees responsible for the export violations will be terminated, according to the settlement. "Their products and services are used for espionage and intellectual property theft", said Sen. Marco Rubio, Florida Republican and a co-sponsor of the legislation.

Cotton and Rubio, along with Sen. As a telecoms and smartphone company, ZTE would struggle to make products without using software from Google, processors and radios from Qualcomm, or any of the other parts that the United States primarily supplies.

Senators proposed a rollback and announced Monday that this will be included as part of the new defense policy bill the chamber began debating.

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ZTE, with a current market value of around US$19.28-billion, is the world's fourth-largest telecom equipment maker after Huawei Technologies, Ericsson and Nokia.

Commerce Secretary Wilbur Ross was on Capitol Hill on Monday evening to speak with senators behind closed doors about the details of the ZTE deal, in a meeting that began shortly after the decision to include the amendment blocking the president's deal was announced.

"The Senate is saying loudly and in a bipartisan fashion that the president is dead wrong to back off on ZTE", said Minority Leader Charles E. Schumer, New York Democrat.

The move enraged Republicans and Democrats who said ZTE not only worked with Iran and North Korea in violation of US sanctions, but is a threat to national security, offering Chinese intelligence operatives a way to spy on the USA through ZTE products.

The amendment will be voted on in the Senate this week, and if it passes, will need to be reconciled with the House version of the bill that passed in May.

"We're just continuing the conversation", said Sen. Tom Cotton, R-Ark., Chris Van Hollen, D-Md., and Chuck Schumer, D-N.Y., added language to the National Defense Authorization Act to reinstate a ban on ZTE buying US components. "I want to keep the conversation going".

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