ZTE has resumed operations after the US government lifted a ban on sales to the Chinese company. ZTE paid a USD 1 billion fine last month and deposited another USD 400 million in escrow, the Department of Commerce confirmed, in order to put an end to the order denying US companies to sell to the company.
The lack of components from US suppliers meant ZTE was forced to suspend its operations after the ban was imposed in April. The company agreed last month a settlement with the US government over the charges of violating a US ban on sales to Iran and a subsequent agreement to change corporate governance at ZTE. In addition to the fines, ZTE has completely overhauled its management to comply with the US' demands. The changes follow earlier penalties paid in 2017 of USD 892 million for the initial sanctions violations. ZTE will remain under scrutiny for compliance with US rules for another 10 years, and if found in violation, could forfeit the USD 400 million in escrow.
ZTE said earlier that it expects to report a loss of CNY 7-9 billion for the first half of this year as a result of fines and the suspended operations. The removal of the denial order against the company took effect 13 July.
