US formally overturns import ban on ZTE

The US government has lifted its denial order against ZTE, finally clearing the way for the vendor to resume major operations.

ZTE suspended major operations after the US Commerce Department banned ZTE from importing components from US companies in April as part of its investigation into ZTE’s alleged violation of US sanctions prohibiting companies from selling equipment with US components to Iran and North Korea.

But after US president Donald Trump signified in May that he would intervene to allow ZTE to get back in business, the department struck a deal in June for ZTE to pay a further $1 billion penalty and hire a compliance team chosen by the US.

ZTE has also been instructed to deposit $400 million into an escrow account that will be forfeit in case of future violations.

Now the ban has formally been lifted after ZTE complied with all the requirements of the deal, as reported.

But some US lawmakers, including junior senator for Florida Marco Rubio, are seeking to introduce legislation to reinstate the ban due to national security and other concerns.

ZTE had already agreed to pay an $892 million penalty imposed by the Commerce Department during the initial investigation into the alleged sanction violations, but the department imposed the ban after accusing the vendor of failing to comply with the terms of the initial settlement.

The development comes in the midst of the escalating tariff war between the US and China.