Commerce Secretary: US reaches deal with China's ZTE

China's ZTE said it ceased major operations last month due to the ban

"We are literally embedding a compliance department of our choosing into the company to monitor it going forward they will pay for those people but the people will report to the new chairman because we are also having them replace the entire management and the entire board", Ross said.

Following the ban on selling USA -made hardware (and potentially software) to ZTE earlier this year, it appears that the company may have reached a compromise with the us government, according to Reuters.

The penalties are in addition to the $892 million in penalties ZTE already paid.

The fine comes on top of the roughly $1 billion ZTE has already paid for selling equipment to North Korea and Iran in violation of US sanctions.

Commerce Secretary Wilbur Ross banned USA companies from doing business with ZTE in April, after his agency learned that ZTE had not followed through on commitments made back in 2016. Besides having to pay a huge fine, ZTE must also allow unrestricted visits meant to verify that USA components are being used as claimed by the company. Ross, speaking on CNBC on Thursday, June 7, 2018.

Senate Majority Leader Charles E. Schumer called for Congress to reverse the decision, which is unlikely.

The probe found that ZTE bought US components and incorporated them into its equipment, illegally shipped them to Iran, and devised elaborate schemes to hide the illegal activity. The U.S. threatened sanctions, but ZTE promised to change its practices and punish the executives responsible for its misconduct.

US senators said they plan legislation to roll back the agreement.

Meanwhile, the South China Morning Post reported Wednesday that ZTE has been sending out letters of reprimand to 35 current and former employees who were associated with the sanction-busting, and is even "seeking to claw back bonuses from those who have left the company".

But then in May, US president Trump had an apparent change of heart; despite election promises of prioritizing US jobs, Trump publicly anxious that ZTE's near-bankruptcy was causing there to be "too many jobs in China lost".

"We will closely monitor ZTE's behaviour", Ross said in a statement. "It's unprecedented to have US agents as monitors ..." "The ZTE case was a thorn in the side for China".

ZTE's survival has been a topic of discussion in high-level U.S. "China is willing to increase imports from the U.S.", Commerce Ministry spokesman Gao Feng told a weekly news conference.

Thursday's agreement was "a prerequisite for making broader progress", DeBusk said.

Shares of Qualcomm Inc rose as much as 4.7 percent while NXP jumped as much as 6.7 percent. NeoPhotonics (NPTN) rose 1.6% to 7.15, while Oclaro (OCLR) climbed 1.4% to 9.18.

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