Huawei now under criminal investigation over Iran trade

The logo of China's ZTE Corp is seen on a building in Nanjing Jiangsu province China

The logo of China's ZTE Corp is seen on a building in Nanjing Thomson Reuters

The Department of Justice (DOJ) is investigating Chinese phone-maker Huawei over whether it violated US sanctions against Iran, The Wall Street Journal reported on Wednesday. The report notes that the USA authorities have been probing Huawei's alleged shipping of United States origin products to Iran and other countries in violation of U.S. export and sanctions law since at least 2016.

In a cryptic message shared via Reuters on Wednesday, ZTE said it planned to take "certain actions" under usa law to counter the ban, but what exactly that means remains unclear.

China's ZTE Corp. held a conference call on Wednesday with major suppliers, during which a company representative suggested the trade dispute with Beijing may have been a factor in last week's USA order banning American firms from selling goods to the smartphone maker, according to a person familiar with the call. "No matter what difficulties we encounter, we can only survive and thrive by doing our own business well and serving our customers better", he said. The New York Times last April reported the US Treasury's Office of Foreign Assets Control subpoena, issued in December 2016, following a Commerce Department subpoena that summer.

Washington imposed almost $1 billion of fines on ZTE for allegedly illegally shipping us goods to Iran.

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Acacia, the Massachusetts-based optical interconnect components maker, is among the major affected American companies.

Huawei was expecting to launch the Mate 10 Pro on United States carriers this year, but government pressure forced both AT&T and Verizon to drop the deal.

Huawei and ZTE have denied these allegations.

On April 20, ZTE said that the U.S ban was unfair and threatens its survival. Then just two weeks ago, ZTE was hit with an export ban that will prevent it from using any US-made technology in its devices, which will create all kinds of problems.

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Without the ban, the company believes its annualized revenue with ZTE and its supply chain partners would have grown up to 5 percent, but the expectation "will not be realized", the company said.

The US forbade expert of communications technology to Iran as part of its sanction against certain regimes, including North Korea.

In a recent statement to the Hong Kong stock exchange, ZTE said that it was "making active communications with relevant parties and seeking a solution" to the U.S export denial order.

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