ZTE continues partial operations in the United States

President Trump’s effort to lift the ban on Chinese mobile manufacturer ZTE is beginning to come into effect, as the United States is once again allowing the company to support its existing products. It seems that the US is taking baby steps with the handset maker, however, as ZTE is not yet allowed to trade with domestic companies until its month trial has run its course.

ZTE was subject to a harsh 7-year trade ban with US companies in April, due to its breach of US sanctions preventing hardware sales to Iran and North Korea, particularly because it failed to adhere to the penalties it received. The ban almost put ZTE out of business, resulting in over $3 billion in lost revenues and the company suspending all major operations.

Trump has since made matters personal with the Chinese president, Xi Jinping, dialling down the punishment in order to ensure the survival of ZTE. The US Senate has largely stood against this decision due to beliefs that ZTE and other Chinese manufacturers pose a threat to national security. This saw both Democratic and Republican parties overwhelmingly voting in favour of reinstating the ban via legislation.

ZTE is expected to remain fully compliant with the new agreement, already having paid its $1 billion fine according to Bloomberg. ZTE’s continuation of operations in the United States is provisional, however, as the Commerce Department’s Bureau of Industry and Security has allowed the manufacturer to further update existing handsets with security patches and features, but prevented it from trading until at least August 1st. It’s uncertain whether or not the company will be allowed to resume its business normally after this date, pending a review from the Bureau.

There’s a chance that the bi-partisan group opposing the agenda will render plans moot, if the piece of legislation passes a conference with the House and receives Trump’s signature. Two-thirds of Congress is needed to surpass a veto by the president, to which it has already demonstrated with the Senate voting 85 to 10. If the bill fails during its meeting with the House, then ZTE could be fully operational once again by the end of the summer.

KitGuru Says: It’s not often that so many members of both parties agree on something, leaving ZTE’s future entirely uncertain. Personally, I’d much prefer to see an investigation turn up incriminating evidence against the company before such a detrimental ban is implemented out of fear, but this is why the fate of an entire country does not rest in my hands. Thankfully.

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