ZTE workers would now be relieved as the Chinese Technology firm has settled its trade rift with the US government. However, the settlement is coming at a huge cost. 1 billion US dollars is the amount they have to pay to lift the ban placed on the company for doing business with Iran which may has crippled the company.
As a result, this prompted the chairman of ZTE apologized to staff and customers to end a ban that has crippled key businesses, including smartphones.
In addition to the fine, ZTE agreed to overhaul its leadership in exchange for lifting the ban. In a memo to staff, Chairman Yin Yimin said ZTE would look to get back into business as soon as possible, and hold those responsible for the breach accountable, a company source said.
“This issue reflects problems that exist with our firm’s compliance culture and at management level,” Yin wrote, according to the source, adding the incident was caused by the mistakes of a few ZTE leaders and employees.
He added the U.S. ban had caused “huge losses for the company” which had been forced to pay a “disastrous price.”
ZTE did not respond to repeated requests for comment.
ZTE pleaded guilty last year to conspiring to evade U.S. embargoes by buying U.S. components, incorporating them into ZTE equipment and illegally shipping them to Iran, paying nearly $900 million in fines. The latest sanction in April was because ZTE lied about disciplining some executives responsible for the original violations.
The ban on ZTE became a key focus in crunch trade talks between Washington and Beijing, and a deal to lift it was struck as U.S. President Donald Trump seeks trade concessions from China and negotiations continue to avoid a trade war between the world’s two largest economies.