Senate adopts measure blocking Trump ZTE deal


Among the team's key responsibilities: replacing the board of directors and firing the senior executives at the Chinese telecommunications equipment supplier.

ZTE, which is based in Shenzhen, is China's second biggest telecoms maker. Shen is ZTE's chief intellectual property officer and acting chief compliance officer.

ZTE didn't immediately respond to a request for comment.

But the ban on buying USA parts, imposed by the department in April, will not be lifted until the company pays the fine and places $400 million more in escrow in a US -approved bank, the agency said.

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Experts say the company faces challenges in getting its factories up and running again while also overhauling its management to meet the terms of the USA deal. The deal would cost a total of $1.7 billion ($361 million was already paid as part of a settlement in March).

As Senator Tom Cotton (R-Arkansas) puts it, "I would expect that there wouldn't be a ZTE". After the ban went into effect, ZTE announced its operations had slowed down to almost nothing because it could not buy vital microchips from American companies, including Qualcomm, based in San Diego. On Wednesday in Hong Kong, they nosedived 40% to their lowest level in more than a year. The coordinator will have a staff of at least six employees funded by ZTE.

Last week, the U.S. reached a deal with the Chinese technology giant that would remove the ban. It depends on US-made components for the production of handsets. "Therefore, ZTE will most likely be able to resume operations in middle of next week".

The amendment will also ban government agencies from trading telecommunications equipment and services with Chinese telecom companies ZTE and Huawei, as well as from providing loans to or subsidizing either company, according to The Hill.

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US Senate leaders from both side of the political fence are expected to vote later this week on an amendment to a bill that could block the agreement between the Trump administration and ZTE.

A bipartisan group of USA senators has put a renewed ban on both ZTE and Huawei into an amendment to the 2019 National Defense Authorization Act. Then the full bill will have to pass, and be merged with a version that passed the House earlier this year.

Commerce Secretary Wilbur Ross told CNBC at the time that ZTE would replace its management team and board and embed a new department for compliance with the U.S.

Confirming details of the US deal, ZTE said late on Tuesday it would replace its board of directors and that of its import-export subsidiary ZTE Kangxun within 30 days of the June 8 order being signed by the United States.

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