Commerce Department Imposes Strict Export Denial Order On ZTE -

On April 15, 2018, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) imposed a seven-year Denial Order (Order) against Zhongxing Telecommunications Equipment Corporation and ZTE Kangxun Telecommunications Ltd. (collectively, ZTE). BIS imposed the Order upon finding that ZTE made false statements to BIS during and after negotiating a $1.19 billion settlement in 2016 for violating U.S. export controls and economic sanctions targeting Iran and North Korea. Commerce Secretary Wilbur Ross stated “ZTE misled the Department of Commerce . . . This egregious behavior cannot be ignored.”

The Order affects business activities of U.S. persons and non-U.S. persons in several ways. Specifically, U.S. and non-U.S. persons are prohibited from undertaking a number of transactions with ZTE, including...