(Yicai Global) March 8 -- ZTE Corp. [SHE:000063], the Chinese telecom equipment maker suspected of violating American export control policies against Iran, has reached a USD892 million settle agreement with the US government.
The fine will mark a record high for criminal export cases, and came after the Shenzhen-based firm shipped millions of dollars of equipment to Iran illegally. The sales were "approved at the highest levels of the company," NBC News cited federal officials as saying, adding that employees involved had to sign non-disclosure agreements and use an email system that automatically deleted messages.
"We acknowledge that we violated US laws and regulations on export control and are willing to take responsibility," Chairman Zhao Xianming said.
A USD300 million fine that the US commerce department's Bureau of Industry and Security issued to the company has been suspended. Whether or not it will be reinstated depends on the firm's compliance with the settlement agreement and continued acceptance of independent compliance controls and audits for the next seven years.
After the US court approves the justice department's agreement and BIS issues a settlement order, the security bureau will propose to remove ZTE, the world's fourth largest telecom equipment maker, from the list of companies banned from importing American goods from firms without an export license.
Last March, the US Department of Commerce restricted exports to ZTE, prohibiting domestic components suppliers from exporting components, equipment and other technical products to the company. The sanction was based on the suspicion that it violated US export control policies against Iran.
ZTE said in its 2016 preliminary earnings forecast that the net loss attributable to ordinary shareholders would be CNY2.4 billion in 2016, due to a one-off USD892 million fine related to an incident in the US.