U.S. reached deal to keep Chinese telecom ZTE in business: congressional aide

U.S. reached deal to keep Chinese telecom ZTE in business: congressional aide

U.S. reached deal to keep Chinese telecom ZTE in business: congressional aide

The president's earlier proposal ran into immediate resistance in Congress, where Democrats and Trump's fellow Republicans accused the president of bending to pressure from Beijing to ease up on a company that has admitted to violating sanctions on Iran.

ZTE was initially banned from buying products exported by American technology companies due to findings showing that it had been selling American technology to Iran and North Korea.

Trump told Fox News on Thursday that he personally negotiated the $1.3 billion fine with Chinese President Xi Jinping in a phone call.

U.S. Commerce Department officials informed lawmakers of the deal under which ZTE will pay a bigger fine than previously expected, hire American compliance officers and shake up its management team, according to the people, who spoke on condition of anonymity.

The US government will remove sanctions on the Chinese telecommunications giant ZTE Corp in exchange for fines and changes in its internal operations, people familiar with the matter have said. Additionally, a bipartisan group of senators has warned the administration not to "compromise lawful US enforcement actions against serial and pre-meditated violators of USA law, such as ZTE.". Passing such a law could be hard, but lawmakers could also pressure the administration by threatening to block any votes on Trump nominees or even unrelated trade agreements until they are satisfied.

The White House did not immediately confirm news of the latest deal.

"ZTE presents a national security threat to the United States - and nothing in this reported deal addresses that fundamental fact", said Maryland Democratic Senator Chris Van Hollen, the author of the Senate provision.

Lawmakers have warned the administration not to go easy on a company that brazenly violated US sanctions against two rogue nations that were pursuing nuclear weapons production.

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"If President Trump won't put our security before Chinese jobs, Congress will act on a bipartisan basis to stop him". USA companies provide an estimated 25 percent to 30 percent of components in ZTE's equipment.

The ban was placed on ZTE after its management failed to comply with punishments imposed on them by the USA following around 40 of its employees selling "hundreds of millions of [US] dollars'" worth of routers, microprocessors and servers to Iranian entities in violation of the US's Export Administration Act of 1979.

Commerce Secretary Wilbur Ross is scheduled to travel to Beijing on June 2 for further discussions over China's aggressive push to challenge USA technological dominance.

And a number of Democrats and Republicans have said products from ZTE, which is partly owned by the Chinese government, could also be used to collect information on USA companies and steal intellectual property.

"Both parties have come together today to strongly rebuke ZTE and the administration's soft approach".

Treasury Secretary Steven Mnuchin famously said last weekend that the trade war is "on hold".

ZTE ran into trouble in 2016 for violating US laws restricting the sale of American technology to Iran.

Shares of ZTE's USA suppliers traded higher on Friday.

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