Congress may overturn President Donald Trump’s deal with Chinese telecom giant ZTE after the company agreed to pay a hefty fine and purge its executives for violating sanctions and posing a security threat.
The Senate may include keeping penalties on ZTE in the National Defense Authorization Act (NDAA). If it passes the Senate, it would need to ratified in the House, voted on in both chambers, and get Trump’s signature.
ZTE agreed to pay a $1 billion fine and put an additional $400 million in escrow in a U.S.-approved bank for 10 years in exchange for ending a ban on its products in the U.S. If ZTE doesn’t violate the agreement, the U.S. will return the money. If ZTE violates the agreement during those 10 years, the U.S. will keep the $400 million.
“It’s going to be three strikes you’re out on ZTE,” White House trade adviser Peter Navarro told Fox News on Sunday. “If they do one more additional thing, they will be shut down.”
The Department of Defense banned the sale of ZTE devices on U.S. military bases for security purposes in April. The Pentagon warned that the devices may be tracking users, which included military personnel on secret bases around the world.
The Commerce Department also placed a ban on ZTE devices in the U.S. that would have lasted for seven years, following reports that ZTE sold U.S. products to Iran and North Korea in 2017, which violated an embargo that prevented ZTE from selling U.S. components to those countries.
The Senate proposal has bipartisan support from Democratic Minority Leader Chuck Schumer from New York, Sens. Republican Marco Rubio of Florida, Democrat Chris Van Hollen of Maryland, and Republican Tom Cotton of Arkansas. (RELATED: ZTE Bribed And Spied On African Officials To Snuff Out US Contract)
Rubio was a vocal critic of Trump’s proposal to help the Chinese-linked company — although ZTE rejects such a description. After Trump was critical of ZTE’s practices and the U.S. placed the ban on it, he apparently flipped on his position, saying he would help the company survive.
Rubio was enthusiastic about keeping the penalties against the company, saying on Twitter Monday that it was “great news!”
“Our bipartisan amendment restoring penalties on #ZTE is included in the #NDAA bill the Senate will be advancing to later this evening,” Rubio wrote.
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