ZTE to Pay $1.7 Billion Settlement to Come Back to US

The wild ride that was the ZTE ban by the US Commerce Department and Trump’s unexpected intervention could soon come to an end, letting the Chinese smartphone maker to finally resume operations.

According to Reuters, the company has agreed to pay a total of $1.7 billion in penalties in a settlement with the Commerce Department. Of those,      $1 billion is the fine and $400 million will be in escrow in case of future transgressions. Adding to those figures are the $361 million that ZTE already paid in the original settlement from a while back.

“ZTE made false statements to the U.S. Government when they were originally caught and put on the Entity List, made false statements during the reprieve it was given, and made false statements again during its probation,” said Secretary of Commerce Ross in the press release announcing the original ban.

Under those terms, ZTE could no longer use any US made components or software, effectively being banned from installing Qualcomm chipsets or Android software on their phones.

Then, in an unprecedented move for a US president, Donald Trump tweeted that he was pressuring the Commerce Department to help ZTE and remove the ban, as the company had been forced to stop major operations.

If Reuters’ sources are accurate, Trump seems to have scored a victory, though he has been criticized by both Democrats and Republicans. In any case, this news means that the sleek ZTE Iceberg everyone is expecting in 2019 remains on track for the launch.

EXCLUSIVE: ZTE has signed an agreement in principle with U.S. that would lift Commerce Department ban; U.S. will claim penalty of as much as $1.7 billion – sources pic.twitter.com/GGgWnqsWl9

— Reuters Business (@ReutersBiz) June 5, 2018