China says 'resolutely opposed' to U.S. export restrictions on ZTE

Mon Mar 7, 2016 9:47pm EST
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By Joel Schectman and Yimou Lee

WASHINGTON/HONG KONG (Reuters) - New export restrictions against China's ZTE Corp (000063.SZ: Quote) for alleged Iran sanctions violations drew fire from the Chinese government, which said on Tuesday it was "resolutely opposed" to the measures but stopped short of announcing retaliation.

The moves announced by the U.S. Commerce Department on Monday are likely to disrupt the telecom manufacturer's sprawling global supply chain and could create substantial parts shortages, according to sanctions experts.

Under the measure, U.S. manufacturers will be banned from selling components to ZTE, a major global supplier of telecom-networking equipment. In addition, foreign manufacturers will be prohibited from selling products containing a significant amount of U.S.-made parts to the Chinese company.

"China expresses its strong dissatisfaction and resolute opposition" to the measure, the Chinese Ministry of Commerce said on its website (

"The U.S. move will severely affect normal operations of Chinese companies. China will continue negotiating with the U.S. side on this issue."

The U.S. Commerce Department, confirming the decision that was first reported by Reuters on Saturday, said ZTE planned to use a series of shell companies "to illicitly reexport controlled items to Iran in violation of U.S. export control laws." It said ZTE acted "contrary to the national security or foreign policy interests of the United States."

In a statement, ZTE said it was "working expeditiously" towards a resolution to the issue.

"ZTE is fully committed to compliance with the laws and regulations in the jurisdictions in which it operates. ZTE has been cooperating and will continue to cooperate and communicate with all U.S. agencies as required," the Shenzhen-based company said.   Continued...

The ZTE company logo is seen as a guest delivers a speech during the company's 15th anniversary celebration in Beijing April 18, 2013.   REUTERS/Barry Huang