A US judge on Tuesday ruled that China’s ZTE Corp (中興通訊), a top telecommunications equipment maker, should be allowed to end its five-year probation from a 2017 guilty plea.
The ruling came on the final day of the company’s probation for illegally shipping US technology to Iran.
It marks the end of a criminal case against ZTE, although it is still subject to a 2018 settlement agreement with the US Department of Commerce.
Photo: Tingshu Wang, Reuters
ZTE had been accused of breaching probation over an alleged conspiracy to commit visa fraud.
An indictment unsealed in March last year said that a former ZTE research director and a Georgia Institute of Technology professor allegedly conspired to bring Chinese nationals to the US to conduct research at ZTE from at least 2014 through 2018 while on J-1 visas sponsored by the university.
While ZTE has not been charged in the visa case, which is pending in Atlanta, Georgia, US District Judge Ed Kinkeade last week held a hearing in Dallas, Texas, on the fraud allegation as a possible breach of ZTE’s probation.
In his ruling on Tuesday, the judge found ZTE was legally responsible for the actions of the former ZTE director.
However, he decided to not take any further action against ZTE, which had reached the maximum term of probation and, ZTE argued, had also been fined the maximum.
As part of its 2017 guilty plea deal, ZTE paid US$892 million.
There was an “open question about legal tools left for the court,” the judge wrote.
Despite the favorable ruling, the judge encouraged the government to pursue any reasonable charges, and criminal or civil penalties, against the company, especially over export compliance matters.
The visa issue was not the first problem that surfaced for ZTE since the plea deal. In 2018, the US Department of Commerce found that ZTE made false statements about disciplining executives tied to the illegal shipments to Iran and, as a result, issued a total ban on the company buying US components.
ZTE, crippled by the move, paid a US$1 billion penalty and agreed to change its leadership and cooperate with a second 10-year monitor, as part of an agency agreement lifting the ban.
In 2018, the judge also took action over the false statements, extending ZTE’s probation and court-appointed monitor from three to five years.
In his ruling on Tuesday, the judge said that ZTE argued that the visa-fraud related events occurred more than three years ago, and that new leadership had brought an improved export compliance program.
“The company has made strides,” the judge said, adding that ZTE’s export control and compliance programs were effectively “nonexistent” when it was originally sentenced.
He said he considered ZTE’s compliance a mitigating factor, but that its record on compliance could be summarized in one word: “Sometimes.”
ZTE in a statement said that it is “proud of the significant improvement in the company’s compliance program and culture.”
It said the improvement has been acknowledged over the years.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his