On Friday, June 8, the Chairman of ZTE Corp apologized to its staff and customers after the technology firm agreed to pay a $1 billion fine to the United States to conclude a ban that has affected the key business negatively, including smartphones.
The ban had prevented the company from buying the U.S. components it relies on to make phones and other devices, and in addition, ZTE agreed to overhaul its leadership in exchange for lifting the ban with a fine of $1 billion. Reuters reported that Chairman Yin Yimin confirmed that the company would get back to business as soon as possible and hold those responsible for the breach.
Yin wrote that the incident was caused by some leaders and employers of ZTE in a mistake, “this issue reflects problems that exist with our firm’s compliance culture and at management level” He added that the US ban had caused a huge loss to its business and has been forced to pay a humongous price.
ZTE pleaded guilty to plotting to elude U.S. embargoes by buying U.S. components, incorporating them into ZTE equipment, and illegally shipping them to Iran. The latest was in April as ZTE thought to hide some executives who were responsible for the original breach.
The ban became the key focus in crunch trade talks between Washington and Beijing. According to the deal, ZTE will change its board and management within the course of 30 days and pay the $1 billion fine with an additional $400 million in a bond. The ten-year ban that is also included in the deal is kept suspended until any other future violation.