USCWG In the News
The Verge: Senate votes to reinstate ZTE ban that's nearly shut down the company
Washington, DC, June 18, 2018
The US Senate has voted to reinstate a ban on ZTE that prevents the Chinese telecom company from buying US components and using US software. But it's still not clear if the reversal will make it into law: it has to clear a conference with the House, and then avoid a veto from President Trump, who advocated for cutting a deal that would lift the ban.
ZTE was hit with the trade ban by the US Commerce Department in April after failing to following through with a punishment for violating sanctions on Iran and North Korea. That ban essentially shut down ZTE, which relies on US parts like Qualcomm processors. Shortly thereafter, Trump said he would cut a deal to revive the company, and a deal was reached — with additional penalties that the department said were uniquely stringent — earlier this month.
But senators on both sides of the aisle immediately threatened to stop the deal and reinstate the ban, citing ZTE as a national security risk. And ultimately, a bipartisan group worked to get legislation introduced.
In a joint statement, Senators Marco Rubio (R-FL), Chuck Schumer (D-NY), Chris Van Hollen (D-MD), and Tom Cotton (R-AR) said today: “We're heartened that both parties made it clear that protecting American jobs and national security must come first when making deals with countries like China, which has a history of having little regard for either. It is vital that our colleagues in the House keep this bipartisan provision in the bill as it heads towards a conference.”
The Senate voted 85 to 10 in support of reinstating the ban. It was included as an amendment on the National Defense Authorization Act, a must-pass piece of legislation that has already moved through the House. Though the House didn't include a similar measure on the ZTE ban, both bills would block the US government from using equipment from ZTE or Huawei — another Chinese telecom often cited by the US government as a security risk — or subsidizing either company.
It's not clear if the ZTE ban will survive, or be weakened, after the two bills are reconciled. If it remains, the legislation also faces the threat of a veto from Trump — though the measure at least has a veto-proof majority in the Senate. In one of the other rare occasions where Republicans stood up to him with a veto-proof vote, passing sanctions on Russia, Trump decided to sign the bill anyway but noted his displeasure.