U.S. reaches deal to save ZTE

The U.S. Department of Commerce announced a deal to allow the export of U.S. components and technology to ZTE, enabling the company to resume operations.

Under the deal,  ZTE must pay $1 billion and place an additional $400 million in escrow. ZTE also agreed to certain provisions allowing monitoring of its compliance with U.S. export control laws.

“Today, BIS (Bureau of Industry and Security) is imposing the largest penalty it has ever levied and requiring that ZTE adopt unprecedented compliance measures,” said Secretary Ross. “We will closely monitor ZTE’s behavior. If they commit any further violations, we would again be able to deny them access to U.S. technology as well as collect the additional $400 million in escrow."

Last year, ZTE paid $892 million in penalties to the U.S government in a March 2017 settlement agreement.

Trading of ZTE shares in Hong Kong has been suspended since April 16th. The company halted major operating activities on May 9.