Another U.S. Bill Aims At China's ZTE Amid Escalating Tensions

Yet another piece of legislation proposed by the United States Congress is rather specifically aiming in the direction of ZTE, a state-owned company from China. Proudly and publicly sponsored by Republican Senators Susan Collins, Jerry Moran, and Marco Rubio, the bill also received support from Democratic Senators Mark Warner, Doug Jones, Chris Van Hollen, and Elizabeth Warren.

While it lacks an actual name, the majority of the proposal appears to be based on another legislative initiative shot down by U.S. lawmakers last summer. Both drafts suggest swift and unconditional actions against ZTE should the firm find itself in any kind of trouble with the Commerce Department moving forward.

Problems with the said agency are precisely what marked most of ZTE's last year, with the firm ending up on the verge of bankruptcy after its officials reportedly refused to cooperate with federal investigators probing their non-compliance with a 2017 settlement over the Chinese manufacturer's violations of stateside trade sanctions placed on Iran and North Korea.

When at first you don't succeed, threaten again

The original bill was introduced by a similar ideological mix of legislators in September but never reached the voting floor, almost certainly by design. President Trump made his position on the matter clear by then, directly ordering for ZTE to be cut some slack in exchange for a larger number of less crippling sanctions so as to gain some goodwill during Washington's negotiations with Beijing over trade, the very same ones that continue to this date. The Shenzen-based electronics maker jumped at the opportunity and agreed to a broad range of concessions, including a fine amounting to about a billion dollars.

Some high-ranking U.S. officials still threatened ZTE but were largely satisfied with the development. Regardless, the firm found it difficult to return to the U.S. market on an identical scale to the one employed before, especially given how its main foothold in the country was the incredibly competitive segment of entry-level Android handsets.

Just under a year later, ZTE's future is looking grimmer than it did in recent years; the company already appears to have lost a significant foothold in the entry-level market across the U.S. and things weren't looking great even before last summer's bill seeking to put an end to its was reintroduced on Capitol Hill; several weeks back, the firm was hit by another wave of scrutiny over allegations that it (once again) violated U.S. export regulations pertaining to Venezuela.

Relationship status: waging a tariff war, so you could say it's complicated

Shortly thereafter, the U.S. brought charges against Chinese Huawei and is currently trying to have its CFO extradited from Canada for similar reasons, alleging violations of the Commerce Department's export control regulations. Coupled with the ongoing trade war between the U.S. and China, the current state of affairs doesn't appear to be anywhere near conducive to ZTE's speedy return to the American mobile market.

That isn't to say the bill re-introduced in the Senate earlier this week is likely to go anywhere; the Trump administration appears to be done with using ZTE as leverage and is now more focused on Huawei as far as its plans for the ongoing trade talks with China's communist government are concerned.

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About the Author
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Dominik Bosnjak

Head Editor
Dominik started at AndroidHeadlines in 2016 and is the Head Editor of the site today. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]