ZTE issues first response on U.S. ban on the sale

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ZTE, the fourth largest telecom equipment maker, said on Friday that a U.S. ban on the sale of parts and software to the China company was unfair and threatens its survival, Reuters reported.
ZTE
The United States imposed a ban on sale of components by American companies to ZTE for seven years, saying the Chinese company had broken a settlement agreement with repeated false statements.

“It is unacceptable that BIS insists on unfairly imposing the most severe penalty on ZTE even before the completion of investigation of facts,” ZTE said in its first response since the ban was announced.

“The Denial Order will not only severely impact the survival and development of ZTE, but will also cause damages to all partners of ZTE including a large number of U.S. companies,” ZTE said in a statement.

ZTE said it regards compliance as the cornerstone of its strategy, adding it invested $50 million in export control compliance projects in 2017 and plans to invest more this year.

A senior U.S. Commerce Department official told Reuters earlier this week that it is unlikely to lift the ban.

The Commerce Department has an appeals process for companies to try to get off the list, but it is unclear whether that would be available to ZTE because the case had been previously subject to a settlement.

ZTE would have little recourse in the near term because appeals would have to be approved by the Bureau of Industry and Security, the same agency that issued the ban.

Companies must submit appeals to a committee that would issue a ruling within 30 days, according to the agency’s website.

ZTE said it will not give up efforts to solve problems through communication, and it is determined to take judicial measures to protect the legal rights and interests of the company.

Meanwhile, the U.S. government is considering using an emergency law to restrict Chinese investments in sensitive U.S. technologies, a senior Treasury official said on Thursday.

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