05:41UK Cyber Security Centre Warns Companies Against Using China's ZTE Equipment


The move comes as the USA government takes ZTE to task in an ongoing row over the company's earlier contravention of U.S. sanctions against Iran and North Korea, and broader trade frictions between the United States and China. The Chinese company used a series of shell companies to sell its products in Iran, and after pleading guilty, it promised to terminate four senior employees and to discipline 35 others.

The US Department of Commerce said ZTE lied to the Bureau of Industry and Security about disciplinary actions supposedly enforced on senior employees relating to the illegal shipments, and paid full bonuses to employees who had engaged in illegal conduct.

Chinese telecom giant ZTE halted trading of its shares in Hong Kong and Shenzhen Tuesday following a U.S. ban on its purchase of sensitive technology, which drew a pledge by China to "safeguard" its companies if necessary.

Aside from illicit distribution of American resources, the U.S.is also accusing ZTE of lying to officials, "and obstructing justice including through preventing disclosure to and affirmatively misleading the U.S. Government". A seven-year ban would effectively cover a critical period during which the world's telecoms carriers and suppliers are developing and rolling out fifth-generation wireless technology.

Efforts to reach ZTE America in Richardson, Texas, were unsuccessful. That settlement included a provision that, should ZTE again be found to be skirting United States trade laws, a seven-year export ban would be imposed.

The Department of Commerce issued an order barring U.S. exports of sensitive technology to the Chinese company for seven years. "ZTE's July 20, 2017 letter is brimming with false statements in violation of§ 764.2 (g) of the Regulations, and is the latest in a pattern of the company making untruthful statements to the U.S. Government and only admitting to its culpability when compelled by circumstances to do so", Majauskas' letter said.

China's Ministry of Commerce said Tuesday, that it "will closely follow the developments" in the ZTE case.

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It is entirely appropriate and part of NCSC's duty to highlight potential risks to the UK's national security and provide advice based on our technical expertise.

The U.S. isn't the only place where ZTE is in trouble.

The letter further said that using network equipment or services from ZTE would have a "long-term negative effect on the security of the UK".

On Monday, Britain's main cyber security agency said it had written to organizations in the telecommunications sector warning about using services or equipment from ZTE.

The department's action against ZTE also prohibits large American companies like Qualcomm and Micron Technology from selling their chips and components to ZTE, China's largest listed telecommunications equipment supplier.

The ban had been put in place in response to ZTE's violation of trade sanctions on Iran and North Korea, the USA said.

Without that agreement - which, it would appear at first glance, Google would no longer be able to extend to ZTE under the terms of these sanctions - ZTE's phones could not be considered Android certified.