US Lawmakers Abandon Move To Punish Chinese Company That Violated Sanctions, Allegedly Steals Trade Secrets

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Eric Lieberman Managing Editor
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U.S. lawmakers seemed set to punish ZTE, a Chinese telecommunications company, but a bipartisan amendment was removed from a defense bill Friday.

With President Donald Trump’s rollback of original sanctions, Democratic Sens. Chris Van Hollen of Maryland and Chuck Schumer of New York, as well as Republican Sens. Marco Rubio of Florida and Tom Cotton of Arkansas, co-sponsored a measure to reinstate punitive actions. But Friday, as officials were debating the nuances of the National Defense Authorization Act — which provides military spending in general, but deals with other intricate policy details — the amendment was taken away, according to Reuters.

ZTE pleaded guilty in March 2017 after U.S. authorities ruled that it illegally shipped American goods to Iran and North Korea. By doing so, it agreed to pay $900 million in fines for violating the U.S. sanctions. Now, in recent months, it has been trying to convince government officials in America that it can be trusted. (RELATED: Chinese Tech Company Swears Americans Can Trust It After Top US Officials Denounced It)

Due to the Chinese government’s paternalistic relationship with many domestic companies, including allegedly  ZTE, bipartisan lawmakers worry that its technology is corrupted (or can be) in some way. And it isn’t only congressmen who have voiced their concerns. ZTE, along with another tech company Huawei, and its conduct were the subject of a Senate Intelligence Committee hearing and an investigative report from the House Permanent Select Committee on Intelligence, both of which listed strong reservations like that of foreign surveillance.

After originally displaying a hard line against China in other ways like tariffs, Trump decided that he wanted to work with China President Xi Jinping to get the massive Chinese phone company “a way to get back into business, fast” after U.S. penalties hit it hard.

“Too many jobs in China lost,” Trump continued. “Commerce Department has been instructed to get it done!”

Originally, roughly a month prior, the U.S. Department of Commerce imposed restrictive policies on ZTE. Its leader, Wilbur Ross, accused ZTE of lying to officials, “and obstructing justice including through preventing disclosure to and affirmatively misleading the U.S. Government.”

Now, it seems that Trump’s push to ease up on ZTE trickled into Congress.

Instead of a seven year ban from working with American companies, which ZTE said would likely put it out of business, Trump agreed to Xi’s appeal to change the penalties — saying a complete change in executive board members and a $1.4 billion fine would suffice. (RELATED: Chinese Executive Ousted By Trump Deal Says His Departure Is ‘Deeply Humiliating)

“Xi Jinping has no ‘intention of following through’ on discussions held this year between the two countries & has ‘not responded at all’ to U.S. demands to stop stealing American trade secrets,” Rubio tweeted Friday. “So lets allow #ZTE to stay in business and keep stealing?”

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