US senators want ZTE sanctions re-imposed if it misbehaves again

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US senators from both sides of the political divide have proposed a bill that would re-impose sanctions on ZTE should it breach the agreement reached with Washington that allowed it to return to business - or any other breach of American law.

The Chinese telecommunications equipment and smartphone manufacturer had been banned from dealing with US suppliers for seven years after it was found to have breached a previous agreement for illegally shipping products to North Korea and Iran.

ZTE was obliged to discipline executives involved in the scandal but failed to do so.

ZTE ban

President Donald Trump personally intervened to find a solution to the situation, leading to the new arrangement which required ZTE to change its management team, pay a $1 billion fine with a further $400 million held in escrow.

The deal has been criticised by both Republican and Democrat members of congress who view the company as a threat to national security due to perceived links with the Chinese government.

Some have called for the ban to be re-instated, while other pieces of legislation have failed due to influence from the Presidential administration

However, it is thought this latest proposal might gather more support as it is intended to be a message to the administration that strong action should be taken if ZTE violates the agreement. It wants a report on ZTE’s compliance made available every 90 days and for the audits that are carried out as part of ZTE’s agreement to also be shared with congress.

ZTE has already started overhauling its management team having been effectively shut down by the ban. It is estimated that as much as 30 per cent of its components are sourced from America.