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Bipartisan Senate effort aims to override Trump’s deal to save ZTE

Senators want the company to again be banned from US-made supplies. A bipartisan group of Senators has added language to the National Defense Authorization Act that would reinstate sanctions on Chinese firm ZTE, the Wall Street Journal reports. The legislation is set to be voted on this week. If it passes in the Senate -- and it's expected to -- it could override a deal that President Trump and the Commerce Department have put in place that would allow ZTE to once again purchase necessary components from US suppliers. Great news! Our bipartisan amendment restoring penalties on #ZTE is included in the #NDAA bill the Senate will be advancing to later this evening. Earlier this year, US officials banned ZTE from working with US companies -- a move brought on by revelations that the company shipped US-made parts to Iran and North Korea and then lied about giving company executives involved with the deals large bonuses. But the Trump administration and the Commerce Department later announced a deal struck with ZTE that would again allow it to access US-manufactured parts. The terms of that deal stipulate that the company has to install a whole new set of directors, embed a US-chosen compliance department and pay a $1 billion penalty. But a number of US lawmakers aren't satisfied with that agreement, saying the issue extends beyond punishment and is more about national security. Senator Marco Rubio (R-FL) told the Wall Street Journal that he agrees the penalties are severe. " But I don't think there's any debate about that," he said. "For me it was more than that." Senator John Cornyn (R-TX) said, "China is using its telecommunications companies as means to conduct espionage. We need to solve the larger puzzle of trade and national security in addition to the enforcement action for the violation of sanctions. " That's why Rubio along with Senators Tom Cotton (R-AK), Chuck Schumer (D-NY) and Chris Van Hollen (D-MD) are advocating in favor of the original penalties -- banning ZTE from US suppliers, including its more important one, Qualcomm. Reinstating a ban could be a death sentence for the company, which already put production on hold when the bans were first imposed earlier this year. "I would expect that there wouldn't be a ZTE," Cotton told the Wall Street Journal. "The death penalty is an appropriate punishment for their behavior." The House of Representatives has already passed its version of the defense authorization bill, though without any language about the ZTE deal. So if the Senate measure passes, the two chambers will then have to reconcile their bills and send it to Trump to sign into law.

Republican senators move to block Trump’s deal to revive ZTE

"The death penalty is an appropriate punishment," Sen. Tom Cotton (R-Ark.) says. Last week the Trump administration announced a deal to lift a ban on US companies exporting technology to Chinese smartphone maker ZTE. ZTE has been largely shut down since the ban was announced last month, because the company depends heavily on Qualcomm chips, Google's software, and other US-made components. But now a bipartisan group of US senators is seeking to reverse Trump's decision and re-impose the export ban. The Wall Street Journal reports that the legislators have reached a deal to attach a ZTE export ban to the National Defense Authorization Act, a "must-pass" bill that authorizes funding for the military. Supporters of the amendment include Democratic minority leader Chuck Schumer and at least two Republican Senators—Sen Tom Cotton (R-Ark.) and Sen. Marco Rubio (R-Fla.). In the closely divided Senate, just a handful of Republican defections can be enough to give critics of President Trump a majority. ZTE is facing the crippling US export ban after the company was caught selling telecommunications equipment to North Korea and Iran in violation of US sanctions laws. ZTE reached a settlement with the US government over the issue in 2017, but the Trump administration says that ZTE didn't keep the promises it made under that deal. The deal required ZTE to pay an $890 million fine. It also required the company to discipline dozens of executives who were involved in the scheme, including withholding bonuses. But the US government says ZTE paid those bonuses out anyway and then lied about it to US officials. In May, the Trump administration imposed a seven-year ban on US companies selling technology to ZTE. ZTE depends heavily on Qualcomm chips and Google's Android operating system, so losing access to US technology was a serious blow for the Chinese firm. But Trump soon raised concerns about the deal, tweeting that it would lead to "too many jobs in China lost." So last week the US government announced a new deal that involved ZTE paying an additional $1 billion in fines, putting $400 million in escrow as a deterrent for future misdeeds and replacing its leadership. "The president did this as a personal favor to the president of China as a way of showing some goodwill for bigger efforts," White House trade advisor Peter Navarro said on Fox News Sunday. Trump has been looking for China's help with this week's summit with North Korea in Singapore. Last month, the Chinese government loaned $500 million to "build an Indonesian theme park that will feature a Trump-branded golf course and hotels." Critics have pointed to that deal as a potential conflict of interest as Trump negotiates with China over ZTE, trade, and other issues. Meanwhile, critics in the Senate—including both Democrats and Republicans—argue that the ZTE deal is too lenient. Cotton acknowledged to the WSJ that the export ban might force ZTE out of business.  "The death penalty is an appropriate punishment for their behavior," he said. If the defense bill passes the Senate with the ZTE amendment attached, it would then go to the House of Representatives, which has already passed the legislation without ZTE language included. Negotiators from the two houses would then have to decide whether to include the ZTE language in the final version of the legislation. The final bill will then go to Trump's desk for his signature. Trump could veto it, but that would set up an awkward confrontation with the Republican-controlled Congress and could delay funding for the military.