Chinese cell phone manufacturer ZTE

China’s ZTE Corporation has agreed to enter a guilty plea and to pay a $430,488,798 penalty to the U.S. for conspiring to violate US laws by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement.  This resolution was made a year after the initial charges were laid.  See for background.

US Attorney General Jeff Sessions said “ZTE Corporation not only violated export controls that keep DOJ plea agreement holds them accountable, and makes clear that our government will use every tool we have to punish companies who would violate our laws, obstruct justice and jeopardize our national security.”

We applaud the DOJ investigation and successful resolution of the ZTE issue.  The DOJ has sent a strong signal to all electronics manufacturers around the world to adhere to US laws.

US policy faces a quandary in these matters.  On the one hand, US policy aims justifiably to keep advanced technologies out of the hands of terrorists and rogue states.  Having a technological edge over the bad guys is essential.  On the other hand, if Chinese, or other foreign corporations start to choose non-US manufacturers’ components for fear of triggering US DOJ penalties, then the DOJ will have served US high-tech and ultimately US security poorly.

For details on the agreement with the DOJ, see

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