China’s Ministry of Commerce says the U.S. Department of Commerce’s plan to prevent ZTE from exporting American-made components will be bad for Chinese firms.
“China expresses its strong dissatisfaction and resolute opposition” to the sanctions, said the Ministry. “The U.S. move will severely affect normal operations of Chinese companies. China will continue negotiating with the U.S. side on this issue.”
The Commerce Department says ZTE set up shell companies to get around the existing ban on shipping U.S.-made gear to Iran. Under the new measures, U.S. companies would not be allowed to export gear to ZTE, nor would foreign firms be allowed to send equipment containing a significant amount of U.S. components to ZTE.
ZTE has urged its suppliers to apply for the new export licenses mandated by the Commerce Department, even though the government plans to deny those applications. The company is working to resolve the matter.
“ZTE is fully committed to compliance with the laws and regulations in the jurisdictions in which it operates,” said the company. “ZTE has been cooperating and will continue to cooperate and communicate with all U.S. agencies as required.”
The measures may cause massive disruption to ZTE’s telecommunications equipment business on a global scale, however, ZTE will still be able to sell its mobile phones in the U.S.
