U.S. Restricts Sales to ZTE, Saying It Breached Sanctions

March 7, 2016

Author: 

Paul Mozur

Publication: 

New York Times

Related Country: 

  • China

The U.S. Commerce Department has placed heightened export restrictions on the Chinese technology company ZTE Corporation.  ZTE, one of China's largest and most prominent tech firms, sold U.S.-origin items to Iran in violation of U.S. sanctions and planned to continue to do so.  The Commerce Depatment released two internal ZTE documents to support its action against the company.  In one of the documents from 2011, ZTE reveals that it has ongoing projects in "all five major [U.S.] embargoed countries - Iran, Sudan, North Korea, Syria, and Cuba," referring to the Iran project as its "biggest risk."  In the second document, the company lays out a proposal to evade U.S. export controls using a network of shell companies, thereby allowing it to re-export controlled items to Iran.  The heightened controls on ZTE require American companies to obtain a license before selling products to the firm.