Global Geopolitical Series: U.S. tightens screw on ZTE with special supervision

The Trump administration is significantly tightening the screw on China’s technology giant ZTE, after years of violation under previous administration where the company sold technologies to countries banned by the United States and violated the order by the previous administration in taking actions against those responsible behind the selling.

Earlier this year, the Trump administration banned ZTE from accessing sensitive U.S. technologies leading to questions with regard to its survival. ZTE’s surrender to the pressure resulted in taking actions against those responsible for violating the U.S. ban on countries and billions of dollars’ worth of fines.

In the latest move, the U.S. Commerce Department announced that it is appointing a special compliance coordinator for the ZTE. A statement from the Commerce Department said, “Secretary of Commerce Wilbur L. Ross, Jr. announced the selection of Roscoe C. Howard, Jr. to be the Special Compliance Coordinator (SCC) for Zhongxing Telecommunications Equipment Corporation, of Shenzhen, China and ZTE Kangxun Telecommunications Ltd. of Hi-New Shenzhen, China (collectively, ZTE). The Special Compliance Coordinator was selected after a rigorous search by the Bureau of Industry and Security (BIS). This appointment is the result of the historic settlement between the Department of Commerce and ZTE that includes a $1.761 billion fine, a ten-year probationary period, and the installation of the coordinator to conduct regular and comprehensive compliance supervision by a team answerable to BIS.”

The Special Compliance Coordinator’s function will be to coordinate, monitor, assess, and report on compliance with U.S. export control laws by ZTE, its subsidiaries, and affiliates worldwide. The coordinator will operate with unprecedented access across the company.