ZTE pays $1 billion fine to US, will finally fix a broken urinal

ZTE has complied with part of its revised punishment raft for breaching trade sanctions by paying the US Commerce Department $1 billion in fines.

An agency official told CNN on Friday that the Chinese tech manufacturer will also forward $400 million into an American escrow account “in the coming days,” as the company gets affairs in order with the rest of its new punishments including ordering a new US compliance monitor on-site and removing the boards of two of its controlling entities.

The punishments, as negotiated through Presidents Donald Trump and Xi Jinping as well as their countries’ respective trade delegations, take the place of a 7-year US imports ban. The ban has prevented ZTE from purchasing American goods — it’s estimated that up to 30 percent of its components mix comes from US companies — and has led to a decision to stop major operating functions for two months, costing an estimated $3.1 billion to the firm.

Weibo via SCMP

One pertinent example of the problem reaching into daily operations is the fact that ZTE has yet to repair a urinal at one of its Shenzhen offices. The South China Morning Post reports the reason is because the urinal is made by New Jersey-based American Standard and that parts would have to come from that company.

ZTE still faces the potential of effectively being blocked from doing business in the United States if the nations’ defense budget is approved as-is. The National Defense Authorization Act contains a clause barring the Defense Department and its contractors from selling to either ZTE or its compatriot Huawei, both considered cybersecurity adversaries. The bill is opposed by Trump, but the House and Senate may have enough votes to overturn an expected veto.

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About The Author
Jules Wang
Jules Wang is News Editor for Pocketnow and one of the hosts of the Pocketnow Weekly Podcast. He came onto the team in 2014 as an intern editing and producing videos and the podcast while he was studying journalism at Emerson College. He graduated the year after and entered into his current position at Pocketnow, full-time.