Exclusive | ZTE’s chairman vows no more compliance breaches after US deal and apologises
The US agreement imposes a US$1 billion penalty on ZTE and the installation of a US-selected compliance team
ZTE’s chairman has apologised to all its 80,000 employees and vowed to strengthen compliance practices after the Chinese telecom equipment maker reached a deal with the US to resolve an export ban, by paying a US$1 billion penalty and agreeing to other measures.
“The activation of the denial order has caused huge losses and the company has paid a huge price. On behalf of the board of directors and management, I would like to apologise to all employees, customers, shareholders and partners,” Yin Yimin, ZTE’s chairman, said in a June 8 internal letter to employees and obtained by the South China Morning Post.
“We must realise that this issue mirrored problems in our compliance culture and management. Our management and employees must reflect on this issue and learn the lesson. We should hold the relevant people accountable and avoid similar issues in future,” added Yin in the letter.
ZTE declined to comment on the internal memo.
The Shenzhen company signed a settlement agreement with the US Department of Commerce’s Bureau of Industry and Security (BIS) on June 7 but the issue cannot be fully resolved until the agreement is approved by the US government and particular conditions are met, Yin said in the letter.
US Commerce Secretary Wilbur Ross on Thursday announced the end of sanctions against ZTE in a deal that imposes a US$1 billion penalty on the company and the installation of a US-selected compliance team to prevent further incidents of the sort that initially prompted the Commerce Department to cut ZTE off from its US suppliers.
