ZTE suspends trading as it is banned from buying U.S. equipment

  • ZTE suspends trading as it is banned from buying U.S. equipment

ZTE suspends trading as it is banned from buying U.S. equipment

ZTE Corp., one of China's biggest tech companies, warned Friday that a ban on access to USA technology threatens the company's survival and said it is looking for a legal solution. Analysts believe that the ban would cut off ZTE from the world of Android, as the OS is essentially the United States produce, and the sanction imposed on the firm covers not just hardware components but also software originating from the country.

In 2017, ZTE pleaded guilty in usa federal court to evading us embargoes, by buying American tech parts, incorporating them into ZTE equipment, then illegally shipping them to Iran.

"Prior to the wrapping up of that process, the Bureau of Industry and Security imposed the most severe sanction against the company".

ACIA fell more than 34% to a record low of $26.00 while OCLR was down 17%.

We can always file this USA vs. ZTE brawl as one more episode of the escalating trade war with China.

"We can see compliance risk has become a core risk for Chinese firms that join global competition", the trade body said in the proposal dated April 18.

ZTE, while China's second-largest telecommunication equipment maker, has dropped out of the top ten in terms of domestic smartphone sales in recent years, according to Canalys, as rivals such as Huawei, OPPO, Vivo and Xiaomi have surged. All told, ZTE purchased 53 percent of its chips from American firms, worth $3.1 billion. The company promised to discipline employees involved in the scheme, but the U.S. Commerce Department said this week they were paid bonuses instead.

Wayne Lam, principal analyst at IHS research, says that because ZTE's phones in the US are compatible with domestic LTE standards, its radio-frequency (RF) components nearly certainly come from Broadcom, Qorvo, or Skyworks-which are also US companies (or in the case of Broadcom, "US-domiciled").

It is possible that ZTE will be facing a serious problem if the problem with the United States commerce department is not solved soon.

iTWire contacted Google on Thursday, asking what effect the ZTE ban would have on the Chinese company's continued use of Android and what would happen to mobile models that were using Android Go.

"Trying so hard, bearing so much, all to fight for China's interest - how touching!" said one popular comment that played on a comparison with a late Qing dynasty official, Li Hongzhang, a chief negotiator in the first Sino-Japanese war.

ZTE, just like many other phone manufacturers, uses hardware from Snapdragon chipset developer Qualcomm, and Android software from Google, both of which it could lose access to under this ban.

ZTE is feeling a great deal of pressure right now because in addition to the new sanctions put in place by the U.S., the United Kingdom has also issued a warning that ZTE equipment and services are risky to use.

Trump is pushing his administration to crack down on what he considers unfair trade practices by China. Within three months of a USA ban, ZTE would "face the brink of bankruptcy", the report said.