US-China deal forces ZTE to replace management and board

The US and Chinese governments are said to be making a deal. The US would lift the import ban, while China would replace ZTE’s management and executives. ZTE may also have to pay hefty fines.

Both governments are getting closer to a deal, but the agreement is not yet there, reports The Wall Street Journal. The Chinese government is also said to have offered to lower tariffs on US agricultural products, but the US government does not consider this a matter of negotiating trade agreements, but of enforcing the law.

ZTE may have to replace management and executives as a result of the deal and pay a fine. How high it could be is unknown. Currently, the Chinese maker of smartphones and networking equipment has shut down its activities because the trade ban prevents it from trading with US companies and thus preventing it from getting many components for its devices. If this continues, ZTE will go bankrupt.

United States President Donald Trump said last week that he wanted to help get ZTE back on its feet. The US Department of Commerce imposed the trade ban as a punitive measure, because ZTE had not honored its commitments. For trade with Iran in 2012, the Chinese manufacturer paid a fine of $980 million, but agreed disciplinary penalties for executives have not been forthcoming.

ZTE Axon M, with American Qualcomm soc and in store with American provider AT&T