The United States Department of Justice opened a criminal investigation into Huawei's Iran dealings with the goal of determining whether the Chinese tech giant violated any trade sanctions imposed on the Asian country, The Wall Street Journal reports, citing sources with knowledge of the development. The current status of the probe remains unclear, though the issue itself is reminiscent of ZTE's own troubles with Washington that saw it plead guilty to a conspiracy to violate Iran trade sanctions last year, with the settlement seeing it agree to an $892 million penalty, among other concessions which it hasn't fulfilled and is now being punished again.
The new investigation is said to be related to subpoenas Huawei was previously served by the Treasury Department's Office of Foreign Assets Control and the Department of Commerce, though none of them were reportedly criminal in nature, unlike the DOJ's latest probe. Both Huawei and ZTE faced accusations of being Beijing's puppets in the past, with ZTE itself being publicly traded but state-owned, whereas Huawei's ownership structure is less clear and the company claims it's owned by employees, albeit every individual loses its stake in the firm after leaving it. Two bills targeting ZTE and Huawei's network equipment are presently making their way through the U.S. House and Senate, with both seeking to bar federal agencies from purchasing such technologies.
The Federal Communications Commission is presently pushing a proposal meant to ban the use of its subsidies for purchasing Huawei and ZTE hardware, with the Department of Agriculture now being pressured to do the same by a bipartisan group of U.S. lawmakers. Huawei's long history of issues in the country saw the company clash with both regulators and firms such as Cisco and T-Mobile, with the American private sector mostly being in conflict with the tech giant over IP infringement and trade secret theft allegations. In 2010, a group of Senators including today's Attorney General Jefferson Sessions wrote a letter to Obama administration's officials accusing Huawei of previously supplying Saddam Hussein's Iraqi regime with telecom equipment used for targeting American aircraft, yet the communication ended up being based on erroneous reports mistaking Huawei for Hua-Mei, an unrelated joint venture of one American and another Chinese company.