China's ZTE Pleads Guilty, Will Pay $1.19 Billion For Violating US Trade Sanctions (reuters.com) 50
An anonymous reader quotes a report from Reuters: Chinese telecom equipment maker ZTE Corp will plead guilty and pay $1.19 billion ($892 million in the Iran case) to settle allegations it violated U.S. laws that restrict the sale of American-made technology to Iran and North Korea, the company and U.S. government agencies said on Tuesday. ZTE entered into an agreement to plead guilty to conspiring to violate the International Emergency Economic Powers Act, obstruction of justice and making a material false statement, the U.S. Justice Department said. The Commerce Department investigation followed reports by Reuters in 2012 that ZTE had signed contracts to ship millions of dollars worth of hardware and software from some of the best-known U.S. technology companies to Iran's largest telecoms carrier. Between January 2010 and January 2016, ZTE directly or indirectly shipped approximately $32 million of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. ZTE then lied to federal investigators during the investigation when it insisted that the shipments had stopped, Justice said. It also took actions involving 283 shipments of controlled items to North Korea, authorities said. Shipped items included routers, microprocessors and servers controlled under export regulations for security, encryption and anti-terrorism reasons.
Re:offenders? (Score:4, Insightful)
It was started as a "state-owned and private-operating" economic entity. None of this is a secret, it's easy to find on the Internet.
No business in China gets as big as ZTE without input from the Chinese Government, that's how business is done over there.
While they have not told the US to get stuffed this time, there might come a day when they will, and I wonder what will happen then?
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You forgot to mention that ZTE is owned partially by the state and one of the listed owners is leadership of the PROC Army. The equivalent US example would be if the US Government created Cisco and provided all the investment money and one third of the company was owned by the Joint Chiefs of Staff.
ZTE is for all intents and purposes a Chinese state actor and should be viewed with suspicion.
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There is LOTS of stuff the US can't readily produce. Or produce at a cost remotely comparable to what China can.
If you want everything to be "Made in USA", be prepared to do without a LOT of stuff. A lot of things just won't be in stores, and a bunch of other stuff will get much more expensive.
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Both economies would suffer, but none will be demolished.
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True, but China's government is probably aware that swooping in to protect ZTE and save $2B that can be bilked from holdings belonging to out of favor managers and directors is not worth the political capital and international goodwill they'd burn in the process.
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What political leaders say and do are two separate things.
Generally, yes. But Trump has surprised a lot of us by actually trying to do some of the outlandish things he said he would. Hyperbole aside, his comments have not changed that much since getting elected.
He did veto TPP which is extremely beneficial to China
I'm still scratching my head on that one. The TPP was built to contain China.
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This also seems highly political. The old ITAR controls, whose current form is what ZTE were prosecuted under, are so overbroad and vague that virtually any piece of technology is a controlled item. Some years ago we ran a Dell equipment catalogue up against them and found that roughly 50% of everything in there was covered by one or more export controls. Almost everyone taking a laptop out of the country was an illegal arms dealer because of how overbroad, and in many cases out of date, the regulations
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yes, can't have them turrists using modern phones. Much easier to hack and spy the older ones...like our president uses.
This goes along with him doing business with an Iranian bank which funds terrorists or his dealings with Cuba while that country was under sanctions.
No big deal. It's only Trump.
Why restrict this at all? (Score:5, Interesting)
If you work 40 hours per week to afford rice, a mud hut, and a pail to go fetch water from the river, you're poor. In the US, we work 40 hours per week and spend a tiny fraction of our income on food (12% of the median household's consumer spending) and running hot water (lol, $45/month here); and only represent about a third of our expenses with large houses with insulation, glass windows, running electricity, and heated space.
The difference is technology. When you do something in a developed country, you use machines and advanced techniques to invest very little human labor and produce enormous output. If 10 people all work together to produce 1,000 units of a thing in an hour with the median-income wage of $27/hr, that's $270 / 1,000 or $0.27 per thing--which might sound meaningful in its own right, but essentially boils down to that thing selling for a price no less than 36 seconds of the median earner's labor. If those 10 people were only able to produce 10 units of that thing with their combined labor, then it's going to cost $27 or 1 hour (3,600 seconds!) of the median earner's labor.
How stable do you think North Korea's government would be in an environment that had to support higher technology? North Korea can bring advanced weapons against us in a war if we sell them advanced weapons; it can't produce advanced weapons. To produce advanced weapons, North Korea needs technologically-advanced factories, which means they need a highly-educated population skilled in all forms of engineering, business management, logistics, and a broad array of the sciences. That's not enough: they need to be able to support the population which provides these things, meaning they need to apply technology in the private sector so as to improve access to food, running water, and so forth, reducing the amount of labor they expend on keeping their population alive and freeing that labor for their military machine.
Does that sound like the kind of blind, raving, fanatical population that would tolerate Kim Jong-Un?
By the time any of these people developed an economy which could support their war effort, they'd have an educated population used to a high standard-of-living and utterly disinterested in their political bullshit. They'd face military coups if nothing else, because their government support structure would also need sufficient education to raise their country to a state capable of supporting the kind of war we're afraid they'd bring to us--and then their intelligence community and their military power centers would quickly recognize the tactical instability brought by the existing government, and tear it down in any way expedient.
They can't become a threat to us without acquiring a steady stream of ready-to-go weapons from a highly-developed third party seeking to wage war without the political consequences of war or simply collapsing internally along the way as the political basis of a developed country fails to support mindless and self-destructive war-mongering.
Economic sanctions are an ineffective and dangerous way to handle undeveloped ratholes.
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Why restrict this at all?
Because North Korea is a cult and we've technically been at ware for then for many many decades.
The difference is technology.
Do you really think they are buying all this technology for their people and not for military use? If you do, you don't know North Korea.
Does that sound like the kind of blind, raving, fanatical population that would tolerate Kim Jong-Un?
So apparently you don't understand how cults work. Besides, you only need a few smart people in each sector to organize the other people.
Economic sanctions are an ineffective and dangerous way to handle undeveloped ratholes.
I agree. However, North Korea was actually quite modern before Kim II Sung declared war and created his cult nation.
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Do you really think they are buying all this technology for their people and not for military use? If you do, you don't know North Korea.
I'm saying a high-tech military machine cannot sustain itself on top of a low-tech, undeveloped economy..
So apparently you don't understand how cults work. Besides, you only need a few smart people in each sector to organize the other people.
You can't have a few smart people and a shitload of serfs in backwater west Africa support a high-tech, industrialized military machine. It doesn't work. You need an industrialized economy to support an industrialized government.
North Korea was actually quite modern before Kim II Sung declared war and created his cult nation.
It's de-modernized now w
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I'm saying a high-tech military machine cannot sustain itself on top of a low-tech, undeveloped economy..
They can if someone else provides them with the technology. It's exactly why there is an embargo!
You can't have a few smart people and a shitload of serfs in backwater west Africa support a high-tech, industrialized military machine
Umm... how many people do you think are technically inclined in your own nation's military? Sure, they can use the technology but they aren't anywhere at the level of actually developing it.
It's de-modernized now why?
It's not de-modernized, it just failed to keep up with modern technology because they've been embargoed. China cut themselves off from the world for a hundred years and they fell behind too despite having many highly intel
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Iran isn't some low tech third world country though. And unlike NK, it's really just the US and Israel that won't deal with them.
My company has sold high tech equipment to them in the past, and these days they buy the same stuff from our distributors in neighbouring countries.
Thanks for not competing.
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Meh, if they are a pain in the arse to deal with, simply tightly, isolate them, nothing in and nothing out, as far as you are concerned. Leave them alone to wallow in the own mire. If problems leak out from the regions aggressively plug those leaks. Providing them technology when they don't want to use it properly, just gives them technology to use improperly. The reason they have unstable violent societies is because that is all they are capable of producing at this time Stop fucking with them and they wil
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Stop fucking with them and they will leave you pretty much alone but the isolation should be really tight, nothing in and nothing out, except refugees in close to border refugee camps,
That's just not realistic without gross human rights violations, and it's not actually necessary. All you really have to do is prevent them from doing any empire-building outside their borders, and don't fuck with them too much, don't blow them up or compromise their government. Eventually they'll want what you've got and start asking for it, or reimplementing it themselves. But we like to go around tampering with things we barely understand politically and then watch them explode, presumably just to keep t
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The core human right is to be allowed to be as self destructive as you wish, should you wish to spread the destructiveness, you should be isolated in the least costly way possible, that cost not just of your citizens pockets but of their lives as well. How many of your own citizens are you willing to sacrifice to feed your urge for questionable human rights, not measured by those in question nor the citizens you are willing to sacrifice but by your own definition.
A human has the right to exist as a wild h
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The core human right is to be allowed to be as self destructive as you wish,
The core human right is to imagine that there are such things as inherent rights.
If you accept that human rights are things we invent, then the right to travel is up there with the right to free association.
How many of your own citizens are you willing to sacrifice
That's the thing, those are humans you're talking about letting be disposed of for convenience's sake.
Now that fully recognises human rights, even if those humans want to hunt, kill and eat each other, no different to any other wild animal.
No. You're just granting their most powerful people the right to do those things, and you're going to help them do it by preventing the people they're murdering (etc.) from fleeing. You're ready and will
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Perhaps economic sanctions are an ineffective way to handle undeveloped countries. But the largest violations by ZTE were with regards to Iran, which is pretty developed. And it was a conscious decision by ZTE to use US made telecom equipment to win Iranian government contracts. It was pervasive and ongoing behavior in violation of U.S. law. And the sanctions in Iran's case helped drive Iran to the bargaining table with regards to its nuclear program, both in terms of abandoning any immediate plans for nucl
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I'm not saying ZTE didn't break the law; I'm saying ZTE's actions aren't inherently harmful and would seem to lead toward a desirable end goal for all parties aside from unstable government administrations.
Iran isn't very "developed" if CISCO routers are high tech. What are we talking about? 1940s United States?
And not one penny will change the fact (Score:2)
that selling that technology to bad actors makes them more dangerous.
This is truly nearly pointless. Even crushing fines that result in bankruptcy and failure only move the corporate assets to another, more devious, and more ingenious entity, harder to detect.
There is no compensatory punishment for such acts. We are left with enemies of their own choosing, more able to harm us, and more costly to repel or defeat.
ZTE violating US China Iran Trade Sanctions? (Score:1)
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