China's ZTE says main business operations cease due to US ban

ZTE shuts down operations

ZTE shuts down business operations thanks to US export ban

Chinese telecom equipment maker ZTE said it has filed a request to the U.S Department of Commerce's Bureau of Industry and Security (BIS) for the suspension of a seven-year business ban.

The Shenzhen-based company disclosed in a regulatory filing Wednesday that "major operating activities of the Company have ceased". The announcement comes less than a month after the United States banned American firms from selling hardware and software to ZTE for seven years, effectively cutting off the company's supply chain. Analysts have said it will be hard for ZTE to stay competitive even if it could find non-American suppliers.

ZTE's announcement states that the company has sufficient cash to remain in business "as of now", and is actively seeking a modification or reversal of the denial order from various USA government departments.

Previously NV was informed that the Ministry of Commerce announced a ban of us exports for Chinese smartphone maker ZTE.

Telstra has said it is ceasing sales of Telstra-branded ZTE mobile and mobile broadband devices throughout its stores and partners following a move by the United States Government banning USA firms from supplying the Chinese device maker with components and technology. Earlier this week, it was announced that Huawei and ZTE phones had been banned from military stores. -China trade talks that are now underway, as the latter country tries to avert the threat of an all-out trade war.

Boost Mobile Australia, which sold the Boost Zume 5 (a re-badged ZTE smartphone), has also pulled the product page for that device from the company's website.


The possibility of losing access to critical US components has led to a great research and development push in China in recent years, as companies race to devise homegrown alternatives; suppliers in Japan and South Korea lack the capacity to provide all the components China needs.

Part of the agreement included letting go of four of its senior employees and disciplining 35 others by reducing their bonuses or reprimanding them, Reuters notes.But according to the Department of Commerce, ZTE rewarded its employees for illegal conduct instead.

ZTE settled the sanction case with the US Government last March after admitting to illegally shipping products with US technology to countries including Iran and paying a record fine of almost US$900 million.

We'll keep you posted as this situation continues to unfold.

"We want to make sure our customers who already own Telstra-branded ZTE devices are looked after", she said.

One employee told Reuters that staff are still reporting to work, but "with not much to do". The company could not compete due to an export ban from the United States.

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