China's ZTE fined US$1.2 bil. for breaching exports ban to Iran and N. Korea
The Chinese telecoms giant, Z-T-E, has agreed to pay a fine of almost 900-million U.S. dollars for violating U.S. laws that restrict the sale of American technology to Iran and North Korea.
It's the largest criminal penalty in an export control or sanctions case... and Washington says it will send a strong message to those who ignore U.S. trade embargoes.
Kwon Jang-ho has this report.
China's second largest telecoms company, ZTE, has agreed to plead guilty to knowingly selling equipment containing U.S. made technology to Iran and North Korea, who are under an exports ban list.
The fine is a record-breaking 892-million dollars, with an additional 300-million dollars if the terms of the settlement are violated at any time during the next seven years.
"With this action, we are putting the world on notice - improper trade games are over with. Those who flout our economic sanctions, export control laws and any other trade regimes will not go unpunished."
ZTE has publicly acknowledged the agreement in a statement and has said it will be instituting new compliance procedures as well as making personnel changes.
The Shenzhen-based company shipped some 32-million dollars worth of equipment to Iran between 2010 and 2016, as well as winning large scale telecommunication infrastructure contracts.
It was also charged in connection with 283 shipments of equipment to North Korea.
Items include routers, microprocessors and servers, and about a third of the company's components are U.S. made.
ZTE admitted to deliberately dodging export controls and lying to federal investigators, including making employees sign non-disclosure agreements and using an e-mail system that automatically deleted messages.
Other Chinese companies are also said to be under investigation for similar violations, so this case could set a precedent for others in the near future.