Trump's ZTE deal challenged by Senate

Sen. Tom Cotton, R-Ark., one of the amendment's co-sponsors, said that if it passes, ZTE will go out of business. Senators on both sides of the aisle criticized Trump for calling on the Commerce Department to reverse its position, with many saying ZTE poses a risk to U.S. national security.

China's No. 2 telecommunications equipment maker was crippled when the United States imposed a seven-year supplier ban on the company in April after it broke an agreement to discipline executives who conspired to evade USA sanctions on Iran and North Korea.

Confirming details of the agreement publicized by the US government on Monday, ZTE said it would replace its board of directors and that of its import-export subsidiary ZTE Kangxun within 30 days of the June 8 order being signed by the United States. When the White House cut a deal with the company last week (imposing a US$1.4 billion fine and a board restructure), Schumer put out a statement calling on Congress to reverse it, saying "There is absolutely no good reason that ZTE should get a second chance, and this decision marks a 180 degree turn away from the president's promise to be tough on China". "Given their repeated violations of USA law, we can not trust them to respect USA national security, and so it's vital we hold them accountable and pass this amendment". "Their products and services are used for espionage and intellectual property theft", said Sen.

US Senate leaders from both side of the political fence are expected to vote later this week on an amendment to a bill that could block the agreement between the Trump administration and ZTE.

The Shenzhen-based company appointed Shen Nan to lead the team, with two assistants, according to an internal memo seen by the South China Morning Post.

Republican and Democratic senators who support the original ZTE punishments feel strongly that ZTE's flagrant violations deserve the ultimate punishment, and not a "slap on the wrist" fine.

As part of the deal, ZTE promised to replace its board and executive team within 30 days, open itself up to USA inspections of its sites and improve public disclosure of its supply chain.

The measure is being included as part of a package of changes agreed upon by committee leaders, meaning that the Senate is likely to include it as part of the defense bill later this week.

"We're just continuing the conversation", said Sen.

Senators plan to add a provision in the National Defense Authorization Act (NDAA), an annual defense policy bill they're expecting to pass this week, that will ban USA suppliers from selling to ZTE, reported The Wall Street Journal. "I want to keep the conversation going".

(Copyright © 2015. All Rights Reserved.)
 
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