U.S. ban causes ZTE to cease main operations


It's been unclear what would become of ZTE for the past few weeks following an export ban against the company earlier this year by the United States government. Not only did ZTE agree to participate in routine monitoring and auditing, but it was also placed on a list of companies USA suppliers are banned from doing business with unless there is government approval.

Employees at ZTE's headquarters in the southern Chinese technology hub of Shenzhen were cagey about speaking to reporters after the ban was announced, but some voiced concerns.

ZTE "maintains sufficient cash and strictly adheres to its commercial obligations subject to compliance with laws and regulations", it said in the statement issued to the Hong Kong stock exchange.

ZTE sent an internal memo to its employees stating that the firm has been "proactively communicating with relevant departments of the U.S government", according to the South China Morning Post.

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After seven days of inactivity, USB Restricted Mode prevents the port from being used to do anything except charge the device. This basically locks the device in a way that it can not be restored or updated via iTunes after the threshold period is met.

Last month, the US government reactivated the ban after it said ZTE violated terms of the settlement and made repeated false statements, which ZTE disputed.

We've reached out to ZTE for further comment on the matter. Instead of suffering the consequences of their actions, the employees had in fact received full bonuses. But the Commerce Department has asserted that ZTE's practices were egregious and included a surreptitious system to sell American-made goods in Iran.

Chinese smartphone makers have typically had a hard time infiltrating the US market, with Huawei repeatedly struggling to land deals with carriers in America, which has seemingly led to the company backing out of American territory.

Updated on May 9: ZTE says it has ceased main business operations due to US ban.