WASHINGTON (AP) — The Trump administration has told Congress it’s reached a deal that would allow Chinese telecommunications giant ZTE Corp. to stay in business, a source familiar with the talks who spoke on condition of anonymity to discuss a confidential matter said Friday.
A resolution of the ZTE case could clear the way for the United States to make progress in its high-stakes trade talks with China. But news of the agreement drew immediate fire on Capitol Hill.
Under the agreement, ZTE would oust its management team, hire American compliance officers and pay a fine. The fine would come on top of the roughly $1 billion ZTE has already paid for selling equipment to North Korea and Iran in violation of U.S. sanctions.
In return, the Commerce Department would lift a seven-year ban on ZTE’s purchase of components that the Chinese firm depends on from U.S. companies. The ban, imposed earlier this month, threatened to put ZTE out of business.
“This is a law enforcement action being handled by Commerce,” said Lindsay Walters, the deputy White House press secretary. “We are making sure ZTE is held accountable for violating U.S. sanctions, pays a big price and that we are protecting our security infrastructure and U.S. jobs.”
The Commerce Department did not immediately respond to a call seeking further details about the agreement.
On Capitol Hill, one senior congressional source said leaders have not yet received formal notification.
Lawmakers have warned the administration not to go easy on a company that brazenly violated U.S. sanctions against two rogue nations that were pursuing nuclear weapons production.
“If the administration goes through with this reported deal, President Trump would be helping make China great again,” said Sen. Chuck Schumer, D-New York.
Schumer added: “Both parties in Congress should come together to stop this deal in its tracks.”
“ZTE presents a national security threat to the United States — and nothing in this reported deal addresses that fundamental fact,” said Sen. Chris Van Hollen, D-Md. “If President Trump won’t put our security before Chinese jobs, Congress will act on a bipartisan basis to stop him.”