ZTE agrees to pay US govt USD 1 bln in exchange for end to sanctions

News General Global 7 JUN 2018
ZTE agrees to pay US govt USD 1 bln in exchange for end to sanctions
ZTE has agreed pay a penalty of USD 1 billion to end the US commerce department’s 7-year ban on buying from US suppliers, CNBC reported, citing a statement from Commerce Secretary Wilbur Ross. Under the deal struck with the US, ZTE will have to pay the fine and have a US-chosen compliance team embedded at the company. The company will pay for the team. The deal also requires ZTE to change its board of directors and executive team within 30 days. 

The settlement deal includes USD 400 million in escrow to cover any future violations as well as requiring. This takes the total deal to USD 1.4 billion. “That money will be forfeited if they violate anything ... and we still retain the power to shut them down again," Ross said. 

ZTE last month suspended major operations in the wake of the ban, which helped increase its losses to over USD 3 billion as clients pulled out of contracts.

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