Indo-Asian News Service Jul 16, 2018 20:15:45 IST
Badly hit by American sanctions, Chinese multinational telecommunications equipment and systems giant ZTE on 16 July saw its stock surging nearly 17 percent after it deposited $400 million in an escrow account in the US.
The US Department of Commerce announced last week that ZTE that faced a seven-year-long ban in the US had deposited the final $400 million in an escrow account, CNET reported.
"That $400 million was the last item ZTE had to provide to satisfy the US government — the company's paying a total of $1.4 billion this time around, on top of $892 million in penalties from a separate March 2017 agreement with the US government," the report noted.
Under the deal, ZTE said it will also fund a US team to oversee the company's compliance. The company has also agreed to change its board of directors and executive team, media reports had said.
The company's stock on Monday was up 17 percent up to reach 16.12 Hong Kong dollars ($2.05).
In June, ZTE agreed to pay over $1 billion as fine as part of a new deal with the US Commerce Department in an attempt to avoid a ban on the company that prevents it from buying American parts.
ZTE, which employs 70,000 people in China, described the move by the US regulators to cut it off from its US parts suppliers as a "death sentence".
The US had imposed sanctions on ZTE for illegal sales to Iran and North Korea, but the Chinese company agreed to take corrective action.
But when regulators in the US found ZTE to be violating the terms of the agreement, they cut off the firm from its US parts suppliers.
Tech2 is now on WhatsApp. For all the buzz on the latest tech and science, sign up for our WhatsApp services. Just go to Tech2.com/Whatsapp and hit the Subscribe button.