The United States Department of Commerce said they have approved a temporary reprieve for China's ZTE Corporation from export restrictions through June after the company was banned from trading with tech suppliers in America.
Early in March, the U.S. Commerce Department imposed strict prohibition on exporting tech goods from ZTE's suppliers in the country after the company allegedly traded controlled items with Iran.
Because of this, ZTE Corp., together with ZTE Kangxun, ZTE Parsian and Beijing 8-Star, was added to the U.S. Entity List under the Export Administration Regulations, the Xinhua News Agency said on Tuesday.
Now, a three-month reprieve has been granted to allow the smartphone manufacturer and its American affiliate ZTE Kangxun to continue trading with their suppliers in the U.S. while abiding by the export regulations of the country, CRIEnglish reported.
Reuters said the temporary ease in restrictions would take effect on Thursday, March 24, until June 30 this year. However, it can last longer depending on how the company cooperates with the western country "in resolving the matter," a statement from the Department of Commerce said.
On Monday, a senior official told the press that the Department of Commerce plans to provide "temporary relief" for the company from the prohibition, which has not only disrupted ZTE's global operations but also China's warming relations with the U.S.
In fact, according to Xinhua News, China's Ministry of Foreign Affairs and Ministry of Commerce strongly opposed the trade ban.
Aside from that, Foreign Minister Wang Yi deemed the prohibition detrimental not only to the company but to others as well, considering that ZTE has been operating in the U.S. since 1998 and has already built steady trade relationships with major tech suppliers such as Qualcomm, Broadcom, Microsoft and Intel.
A recent report from the outlet revealed that Qualcomm had already recorded almost $40 million worth of loss due to trade restrictions with the Chinese telecoms company.