The company is headquartered in Shenzhen, Guangdong, China, but the U.S. subsidiary is located in Richardson, Texas. ZTE relies on U.S.-made materials for smartphones and computer network equipment. The company has close ties with the Chinese Communist government. The new agreement provides for a $1 billion fine and a $400 million fine. This is the largest sentence ever imposed by the BIS. Other compliance measures include obtaining a team of coordinators specially selected by the BIS and responsible for the BIS for a period of 10 years. The aim is to monitor ZTE`s compliance with U.S. export control legislation. ZTE will also be required by the new agreement to maintain a team of compliance coordinators selected by the Department`s Office of Industry and Safety for a period of 10 years and placed under the authority of the Office of Industry and Safety (BIS).

Its mission will be to monitor real-time compliance with U.S. export control legislation. This is the first time that the BIS has received such strict compliance measures in all cases. The new agreement again provides for a refusal order, this time for 10 years, which THE BIS will be able to activate in the event of an additional infringement during the ten-year trial. Finally, ZTE also replaced the entire board of directors and the management of the two units. The United States has banned trade in response to sanctions violations against Iran and North Korea. The company then failed to impose a fairly basic set of sanctions – such as non-granting bonuses to people who violated trade sanctions – and repeatedly lied to the U.S. government, according to the Commerce Department.

This led zTE to conclude that ZTE “is not able or unable to be a reliable and trustworthy recipient of goods, software and technologies originating in the United States.” Three months later, however, President Donald Trump lifted sanctions as part of a trade deal with China. The preliminary agreement includes a $1 billion fine against ZTE plus $400 million to fiduciary to cover future violations, sources said, adding that the terms were in line with Reuters` report on U.S. claims on Friday. The Commerce Department plans to amend its 2017 settlement agreement and count the $361 million paid to ZTE under the contract, which will allow the U.S. to claim a total fine of up to $1.7 billion, the sources said. The original agreement was in favour of violating U.S. trade embargoes and sanctions imposed by the sale of supplies, the construction and operation of telecommunications networks in Iran and the shipment of telecommunications equipment to North Korea. As part of the agreement, ZTE agreed to suspend export privileges for seven years if they violate the agreement or commit other offences.