By Barry Eitel
SAN FRANCISCO (AA) – The White House on Wednesday pushed back against attempts by Congress to reinstate a ban on U.S. companies from supplying Chinese smartphone maker ZTE.
ZTE on Wednesday began trading shares on the Hong Kong stock exchange for the first time in two months. The company suspended trading after the U.S. Commerce Department announced the supplier ban due to ZTE allegedly evading U.S. sanctions on Iran and North Korea. After the company agreed to pay a $1.4 billion fine and fire its leadership, the White House agreed to lift the ban.
The Chinese company argued that the ban on buying American parts would effectively shutter the entire business.
Shares of ZTE plummeted over 40 percent on their first day of trading following the suspension and ZTE lost billions of dollars in market capitalization.
The supplier ban, however, may be brought back.
The U.S. Senate voted for an amendment Tuesday that would strike the deal between ZTE and the administration of President Donald Trump. A bipartisan group of Senators approved an amendment to the National Defense Authorization Act that would reinstate the ban on American businesses from supplying ZTE.
The amendment would have to be approved by the House of Representatives.
White House spokesman Hogan Gidley warned Congress against reinstating the ban, saying in a statement that the $1.4 billion fine amounted to “massive penalties” and an “historic enforcement action”.
“This will ensure ZTE pays for its violations and gives our government complete oversight of their future activity without undue harm to American suppliers and their workers,” Gidley said.
Senate Minority Leader Charles Schumer, a Democrat, urged lawmakers from both parties to be “resolute” in legalizing a supplier ban.
“We can't back off on an issue so vital to America,” Schumer said in a statement.