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Senate to include measure blocking Trump's ZTE deal in defense bill

13 June 2018

Visitors pass in front of the Chinese telecom giant ZTE booth February 26 at the Mobile World Congress in Barcelona. Tom Cotton (R-Ark.), one of the chief authors of the amendment. Trump's administration struck a deal with ZTE last Thursday, which allowed the company to continue buying components from the USA, under supervision, with a $1 billion fine.

The language will be part of an amendment to the 2019 National Defence Authorisation Act, which will go to the Senate for a vote and needs both House approval and US President Donald Trump's signature to become law.

The amendment will also ban government agencies from trading telecommunications equipment and services with Chinese telecom companies ZTE and Huawei, as well as from providing loans to or subsidizing either company, according to The Hill. "Given their repeated violations of USA law, we can not trust them to respect USA national security, and so it's vital we hold them accountable and pass this amendment".

"These companies have direct links to the Chinese government and Communist Party".

"The fact that a bipartisan group of senators came together this quickly is a testament to how bad the Trump administration's ZTE deal is and how we will not shy away from holding the president's feet to the fire when it comes to keeping his promise to be tough on China", Schumer said. The intelligence community suspects the company's devices are mechanisms for espionage that can be remotely tracked and used to steal intellectual property. Marco Rubio, Florida Republican and a co-sponsor of the legislation.

But a number of U.S. lawmakers aren't satisfied with that agreement, saying the issue extends beyond punishment and is more about national security. The move by senators on Monday to include it in the annual must-pass defense bill came just hours before Trump meets with North Korean leader Kim Jong Un. North Korea is largely dependent on economic ties with China, where leaders had claimed that absent a ZTE deal, the telecom giant would collapse.

While the settlement announced Monday by the U.S. Commerce Department would allow ZTE to resume buying parts and selling products in the U.S., there was a catch.

Republican and Democratic lawmakers introduced the legislation last week and said they hoped the Senate would consider it as part of the NDAA, legislation Congress passes every year.

White House trade adviser Peter Navarro on Sunday likened the deal to "three strikes you're out", referring to two prior violations ZTE committed under the sanctions agreement with the U.S. "I want to keep the conversation going".

Senate to include measure blocking Trump's ZTE deal in defense bill