After two months of suffering, ZTE finally got a little better. On the evening of the 12th, ZTE issued an announcement announcing that it had reached a new settlement agreement with the US Department of Commerce, and will resume trading today. However, the price Extremely heavy.
According to the latest announcement, ZTE and its wholly-owned subsidiary ZTE Kangxun have entered into an “Alternative Settlement Agreement” with the Bureau of Industry and Security of the US Department of Commerce (hereinafter referred to as 'BIS') to replace ZTE’s agreement with BIS in March 2017. The "Reconciliation Agreement."
The new settlement agreement shows that ZTE must pay a total of 1.4 billion U.S. dollars in civil fines to BIS within three months. ZTE had previously paid a fine of 890 million U.S. dollars, and the cumulative amount of tickets thus far reached 2.29 billion U.S. dollars. Only in ZTE After the communication has paid all of the US$1.4 billion, the BIS will terminate the activation denial order and remove ZTE from the List of Forbidden Exporters.
At the same time, ZTE will replace all members of the board of directors of the company and ZTE Kangxun within 30 days after BIS issues the order of June 8, 2018. ZTE will work with the current senior vice president of the company and ZTE Kangxun and all the above high-level leaders. Leadership, and any involvement, overseeing the BIS's proposed allegation letter issued in March 2017 or the April 15, 2018 refusal to order the cancellation of the contract by the management or senior officer responsible for the conduct or other responsibility for the conduct involved. ZTE and its subsidiaries or affiliates may no longer employ such personnel.
In addition, BIS will issue a new refusal order for a period of ten years (hereinafter referred to as the 'monitoring period') since its order of June 8, 2018 (including the 'monitoring period'), including restricting and prohibiting ZTE's application, obtaining or using any licenses, , or export control documents, and in any way engage in any transaction involving any item, software, or technology subject to the US Export Administration Regulations.
ZTE needs to hire an independent special compliance coordinator (hereinafter referred to as “coordinator”) at its own expense to coordinate, supervise, evaluate, and report that ZTE Corporation and its global subsidiaries or affiliates comply with the 1979 US Export Administration Act, Regulations, Agreements and Orders as of June 8, 2018.
It can thus be seen that although ZTE has 'lived', the price paid is not too great. What do all the above-mentioned heavy penalties mean for ZTE?
This means that ZTE’s exchange will only be a 'probation' rather than a complete cancellation of the refusal. The 10-year new refusal order will continue to be a haze on the top of ZTE's head, and we must always be cautious, otherwise we will have to The risk of sanctions. The existence of a 'coordinator' means that ZTE may also be supervised by the United States.
In any case, it is not easy for the ZTE Incident to have this result. After all, the existence of the refusal order has caused continued serious damage to the market structure and capabilities accumulated by ZTE over the years, and even directly threatened the survival of the enterprise. As for corporate responsibility, ZTE, survival is undoubtedly the top priority.
This incident will objectively promote ZTE to work harder on its export control compliance work. It will also further promote its efforts in the communications field, adhere to independent innovation, increase investment in R&D, and achieve breakthroughs in more core technologies. And improve the industry chain capabilities, making themselves more powerful.