The congressional effort to nullify an agreement between ZTE Corp. and the Trump administration is set to continue despite the Chinese telecommunication firm’s rush to comply with the deal’s terms.
The Commerce Department said in June it would lift a seven-year U.S. sales ban on ZTE in exchange for a $1.4 billion fine and the overhaul of the company’s executive team. Fourteen directors, including Chairman Yin Yimin and President Zhao Xianming, resigned from the company’s board on Friday. The eight new board members appointed by ZTE were reportedly chosen by the firm’s state-backed controlling shareholder.
The announcement did little to ease concerns over the deal from lawmakers such as Sen. Marco Rubio, R-Fla., who are hoping to scrap it through legislation. Elected officials have long charged that both ZTE and fellow Chinese firm Huawei Technologies Co. act as conduits for Chinese espionage in the U.S.
Rubio “supports putting ZTE out of business and opposes any deal that throws a lifeline to the Chinese company,” a spokeswoman said. “Any change in ZTE’s leadership is purely cosmetic.”
The Senate included in its annual defense policy bill a measure to reimpose the sales ban on ZTE. The House counterpart to the legislation did not include such a provision, and the Trump administration previously said it would work with lawmakers to drop the Senate language in conference negotiations.
The House did, however, include language to block the U.S. military from purchasing any products or services from ZTE or Huawei Technologies in a $675 billion bill to fund the Pentagon.
The Pentagon previously banned the sale of products from either firm on military bases. The Federal Communications Commission is also considering a rule that would effectively block any rural telecommunications carrier from using equipment from ZTE or Huawei.
