US probing Huawei for possible Iran sanctions violations

Apr 26, 2018, 06:44
US probing Huawei for possible Iran sanctions violations

Authorities have subpoenaed Huawei seeking information related to its alleged shipping of US -origin products to Iran and other countries in violation of export and sanctions laws, two sources told Reuters. The New York Times has reported that the company has been subpoenaed by the Commerce and Treasury Departments over alleged violations of Iran and North Korea sanctions.

Internal ZTE documents posted on the Commerce Department website cited a rival, referred to only as "F7", as also violating US export controls in sales of equipment to Iran.

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China's ZTE Corp said on Wednesday it planned to take "certain actions" under US laws following a ban by the USA government on American firms doing business with the company.

Major US telecoms companies have already steered clear of the two Chinese firms, sometimes on the strong suggestions of US officials. The probe was first reported by the Wall Street Journal on Wednesday. ZTE had previously reached a settlement with the Commerce Department's Bureau of Industry and Security, and pleaded guilty as part of a sanctions-violations agreement with the Justice Department. A Huawei spokesman declined to comment. That's the same thing that got ZTE slapped with a almost $1 billion fine and (recently) a USA technology export ban.

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Separately, the Federal Communications Commission voted unanimously last week to ban federal funds from being used to purchase networking gear from companies determined to be a national security risk, dealing another blow to ZTE and Huawei.

Issues and warnings against Huawei have come from presumptions that the company has ties to the Chinese government. In addition to producing networking gear and other electronics, it was the globe's No. 3 smartphone seller previous year behind Samsung Electronics Co. and Apple Inc.

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The US has taken a recent stance against Huawei's products. Earlier this year, things escalated when carriers and, later, retailers pulled out from partnerships with Huawei, refusing to sell its smartphones. This post by Doug Dawson outlines some of the moves in Washington against both Huawei and ZTE, two Chinese telecommunications manufacturing giants. Still, another setback in the USA market could cause Huawei to throw in the towel and concentrate on other regions.