US extends ZTE reprieve from sanctions over alleged violations

Visitors check out products at the ZTE stand at the Mobile World Congress in Barcelona, Feb 24, 2014. [Photo/Agencies]

The US government has extended through to Aug 30 a reprieve of tough export restrictions imposed on the Chinese smartphone maker ZTE in March for allegedly breaking sanctions against Iran, the Commerce Department said on Monday.

The renewed Commerce Department license allows ZTE to continue exporting equipment containing US technology. The agency said in March that its first reprieve could be extended if the company cooperated with the government.

Experts said US export restrictions were some of the toughest ever applied and would have caused disruption across ZTE's sprawling global supply chain.

The restrictions would have banned US companies from exporting to ZTE any technology, software or equipment such as chips and processors made in the United States. The decision would also have prevented software makers from selling typical office applications like Microsoft Windows - or even providing updates.

But soon after imposing the restrictions in March, the agency offered the company a three-month relief from the restrictions, which was set to expire June 30. The Commerce Department announced the extension in a notice posted Monday.

In an emailed statement, ZTE Chairman Zhao Xianming said the extension shows that the company is improving its compliance and cooperating with the US government's investigation. The reprieve will allow ZTE to maintain its "relationships with hundreds of American companies and our continued investment in the US," he said.