ZTE has been banned from buying components or parts from the US for seven years, after the US Commerce Department said the company violated the terms of a settlement reached last year. ZTE was fined for shipping equipment to Iran and North Korea in times of sanction. It then paid a bonus to the employees that engaged in these practices and gave false information over the disciplinary action taken, the Commerce Department found, violating the terms of the settlement.
ZTE said it was aware of the export ban imposed by the US Commerce Department and that it is assessing the "full range of potential implications". The company has in the past denied its telecom gear poses any national-security risk to countries where it is sold.
In a statement that only addressed US actions, China’s Commerce Ministry said it was looking at the export controls on ZTE and urged the US to provide "an impartial, fair and stable legal and policy environment", the Wall Street Journal reported. Otherwise, it said, China is prepared to adopt unspecified measures to defend the interests of Chinese companies.
UK risks
Regarding the UK, officials there said they were specifically concerned about new Chinese laws they said gave China "wide-ranging powers of compulsion", an official familiar with the matter told the WSJ. Officials believe one way to manage the risks posed is to have non-Chinese equipment installed alongside the Chinese-made gear. This would make it harder to exploit any accidental or intentional vulnerability in the Chinese technology, they say.
Ian Levy, technical director of the UK’s National Cyber Security Centre, has sent a letter to telecom companies in the country, warning them about the potential risks of using ZTE equipment. The NCSC said its technical advice was that "the national security risks arising from the use of ZTE equipment or services within the context of the existing UK telecommunications infrastructure cannot be mitigated."
