ZTE shuts down operations due to US sanctions

ZTE has shut down its operations due to sanctions imposed by the United States. The Chinese manufacturer still has enough money to meet its financial obligations, but seems to have stopped selling products.

According to Reuters, ZTE has announced that its core operations have been halted as a result of the sanctions. The company would not respond to questions from the news agency, but an employee is said to have said that there is “little to do” and that business travel has been suspended. According to the news agency, ZTE has stopped selling smartphones through its own website and the phones have also been unavailable at the Taobao trading place for a few days.

The Chinese ZTE is largely dependent on American suppliers for its business operations. These are component makers such as Qualcomm and Intel, which ZTE uses in its smartphones and telecom equipment. Due to a trade ban, US companies are no longer allowed to supply ZTE.

It is not clear whether and when ZTE can resume its activities. The company says it is still in talks with the US government. On Sunday, the Chinese manufacturer submitted a request to suspend the sanctions.

ZTE previously said US sanctions threaten the company’s survival. The US government imposed the trade ban as a punitive measure, because ZTE had not adhered to the agreements made. The Chinese manufacturer has been fined $980 million for supplying products to Iran, but should also have imposed a disciplinary penalty on executives. ZTE admitted that this was not done and the trade ban followed.