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ZTE's main business operations cease amid US ban

10 May 2018

Chinese telecommunications company ZTE has halted its main operations after US authorities cut off its access to American suppliers as President Donald Trump steps up pressure over trade and technology issues with Beijing.

"As a result of the Denial Order, the major operating activities of the company have ceased", ZTE said in a statement. The out-of-court settlement demanded that the company take action against the employees responsible for the leak, but the company failed to do so, which resulted in a ban that forbids USA firms from supplying it with components and technology.

Analysts have also stated that it would be hard for ZTE to stay competitive, even if it could find non-US alternatives to its key components. The ban was imposed after ZTE was found guilty of violating U.S. export restrictions.

CHINESE SMARTPHONE MAKER ZTE has suspending operations just weeks after the United States slapped the firm with a crippling seven-year sales ban. ZTE got to this place by selling goods and services to Iran and North Korea, which violated USA sanctions.

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The US Department of Commerce's Bureau of Industry and Security (BIS) in April imposed the denial of export privileges against ZTE.

ZTE said that the U.S ban was unfair and threatens its survival. Those companies include San Diego-based Qualcomm, which supplies processors for more than half of ZTE's smartphones, per Quartz.

ZTE may be suspending major activities to throw their full weight behind their argument against the US government.

ZTE was accused by the U.S. Department of Commerce of illegally shipping U.S. equipment to Iran and North Korea.

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Because ZTE makes a lot of the products using components from Qualcomm and Intel, a ban on United States companies supplying them is a huge hit.

Reports emerged this week that the Chinese government has stepped in on ZTE's behalf and is now in talks with the usa government.

The ban, which effectively cuts off much of ZTE's supply chain, came amid heightened tension over a possible US-China trade war. Unlike many online publications, we don't have a paywall or run banner advertising, because we want to keep our journalism open, without influence or the need to chase traffic.

ZTE declined to comment on the suspension of its sales channels and after-sale services as well as the revision and redirection of its websites. Is the export ban against the company fair?

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ZTE's main business operations cease amid US ban