After seeing itself slapped with restrictions on being able to buy components produced in the U.S., ZTE has earned a bit of a reprieve as the U.S. Commerce Department has announced they are temporarily lifting the sanctions that were put in place earlier this month. The Commerce Department indicates the move comes in response to ZTE’s cooperation with the U.S. government in dealing with the original trade issue, although Commerce reserves the right to re-institute the restrictions at a later time if deemed necessary.
The original sanctions were imposed after the U.S. government alleged ZTE was working with governments in places like Iran to circumvent U.S. trade restrictions. The allegations included claims that ZTE had set up shell entities to use to funnel technology purchased from companies like Microsoft, Dell and IBM, which were then sold in restricted locations. Although ZTE has been quiet on the matter, working behind the scenes, the Chinese government used the sanctions to complain about U.S interference in foreign country trade policies.
The news is certainly good for ZTE which saw trading in stock halted and was unable to file earnings reports while dealing with the fallout of the Commerce action.
source: The Wall Street Journal