According to the Denial Order issued on April 15, 2018 by Richard Majauskas, Secretary of the US Department of Commerce’s Export Enforcement Administration, ZTE sent a letter to the US Department of Commerce on July 20, 2017. , On November 30, 2016, it sent a letter to inform the start of the company's internal investigation and rectification, and attached a list of 39 ZTE employees who were punished.
Of the 39 employees, 4 were required to be expelled pursuant to the settlement agreement; of the remaining 35, ZTE promised to cut the bonus of 30% - 50% in 2016 as a penalty.
By February 2, 2018, the U.S. Department of Commerce sent a letter asking ZTE to provide the current positions, titles, terms of reference, and salaries of the 39 employees. The results showed that, except for the 4 who had been dismissed, the remaining 35 were In addition to one person, the remaining 34 people received the full bonus in 2016.
In this regard, in order to resume business as quickly as possible, ZTE has recently replaced the company’s top three times in succession. Including: In May, Fan Qingfeng, Senior Secretary of the Board of Directors of the Cancellation Committee of the Party Committee of the Party, was replaced, replaced by ZTE Non-Executive Director and Director of the China Aerospace Science and Technology Group’s Think Tank Tian Dongfang. In March, Cheng Gang, former chief compliance officer and legal director, was dismissed, Xu Huijun, former executive vice president and chief technology officer, and Huang Dabin, who oversees company operations.
The re-punishment of the 35 employees who caused the issue was more like a signal of reconciliation. The South China Morning Post reported that an unnamed person was quoted as saying that among the 35 employees, the remaining employees have been deducted from the bonus. Employees who have left the company have also been issued a lawyer letter by ZTE asking them to recover their bonuses.
Prior to this, ZTE had reached an agreement with the U.S. Department of Commerce and signed a principle agreement. This preliminary agreement required ZTE Corporation to pay a fine of US$1 billion and took out another US$400 million into the escrow account to prevent ZTE from violating again in the future. Sanctions.
Reuters quoted sources as saying that the Ministry of Commerce will also revise the 2017 reconciliation agreement with ZTE to include the 361 million U.S. dollars in fines already paid by China. The U.S. government can claim that ZTE has violated U.S. sanctions on Iran and North Korea. In total, it paid US$1.7 billion to the United States.
In addition, ZTE must also be reviewed at any time to ensure that the parts supplied by US companies are used truthfully and the details of the use of U.S. parts in ZTE products are announced on its website. ZTE must also Board and management rectification.
When ZTE paid a large amount of fines in exchange for the U.S. withdrawal of the seven-year ban, the Wall Street Journal quoted informed sources and wrote that if the Trump administration abandons the threat of tariffs, China is willing to purchase nearly 70 billion U.S. dollars of agricultural, manufacturing and Energy products.
What may be variable, however, is that after ZTE signed the principle agreement, it immediately triggered a strong rally in the US Congressional Democrats. 'If the report is true, the president is to give priority to China, not the United States. 'The Senate from New York Party leader Sen. Chuck Schumer (D-NY) said in a statement.
James Rockas, a spokesman for the Ministry of Commerce, said that this principle agreement is not a definitive agreement. At present, the parties have not signed any specific agreement.
However, this did not ease the opposition from Congress.
By escaping ZTE, Trump’s attitude toward China was like a lion, but like a lamb, Schumer criticized the Trump administration and said, 'The Congress should immediately stop the two parties from blocking the agreement. '
Sen. Mark Warner (D-VA), a Senate intelligence committee chief Democrat, also issued a statement saying the decision would be a serious mistake.
'If the report is true, it will be a major mistake,' Werner said in the statement. 'ZTE poses a threat to our national security. This is not my family's statement, but the unanimous conclusion of all our intelligence units.'