DOJ probing Huawei over possible sanctions violations

DOJ probing Huawei over possible sanctions violations

DOJ probing Huawei over possible sanctions violations

The US Justice Department has opened an investigation into suspected violations of Iran sanctions by China's Huawei Technologies, the Wall Street Journal reported Wednesday.

News of the Justice Department probe follows a series of USA actions aimed at stopping or reducing access by Huawei and Chinese smartphone maker ZTE Corp to the US economy amid allegations the companies could be using their technology to spy on Americans. The company promised to discipline employees involved in the scheme, but the U.S. Commerce Department said last week that they were paid bonuses instead.

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Huawei's struggle against the U.S. government seems to have taken yet another turn. ZTE is now facing a seven year supply ban for selling its devices in the Middle Eastern country. The New York Times last April reported the U.S. Treasury's Office of Foreign Assets Control subpoena, issued in December 2016, following a Commerce Department subpoena that summer.

The investigation comes one month after the agency reached a $430 million settlement with Chinese phone-maker ZTE for also violating USA sanctions with Iran.

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"Huawei complies with all applicable laws and regulations where it operates, including the applicable export control and sanction laws and regulations of the UN, US and European Union", spokesman Charles Zinkowski said in a statement. The company is also the world's No. 3 maker of smartphones. China doesn't actually have any sanctions on the country, and shipping Chinese technology would not directly violate United States sanctions.

The US has taken a recent stance against Huawei's products. Ciena and Infinera, of course, compete with both Huawei and ZTE in global markets (except China).

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The DOJ's actions follow a larger pattern of the USA increasingly cracking down on Chinese firms. ZTE had previously reached a settlement with the Commerce Department's Bureau of Industry and Security, and pleaded guilty as part of a sanctions-violations agreement with the Justice Department.

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