The US imposed a record fine on the Chinese ZTE and removed its sanctions
The US authorities have entered into an agreement with ZTE Corp., which will lift US sanctions from the Chinese company and allow it to stay in business, said US Secretary of Commerce Wilbur Ross in an interview with CNBC.
The agreement provides for the company to pay a fine of $ 1 billion .
This is a record fine ever imposed by the Ministry of Commerce on the offender of export controls
In addition, ZTE will create a team in the field of compliance from the number of employees selected by the American side.
We are literally implementing a team in the field of compliance, selected by us, to monitor the situation in the company
The agreement also requires ZTE to make changes to the board of directors and the management team within 30 days, he said.
Ross noted that the terms of the agreement with ZTE are “tough enough,” and the US “still has the authority” to withdraw the company from the game.
The agreement provides for the opening of an escrow account amounting to $ 400 million, the funds from which can be written off in case the company admits any violations in the future.
We require them to contribute $ 400 million to the escrow account. They will have to pay a total of $ 1.4 billion. The company will lose this money if the violations continue.
This should serve as a good deterrent not only for ZTE, but for other potential violators.