A US federal judge extended a court-appointed monitoring period of ZTE by two years after finding the company violated a probation imposed for illegally shipping US goods to Iran.

ZTE issued a statement to the Hong Kong Exchange acknowledging the change in probation conditions, which it said included “extending the term of the court-appointed monitor to 22 March 2022”. The original monitoring period, imposed to assess ZTE’s compliance with US export control laws, was due to end in 2020.

The Shenzhen-based vendor said a second key term of the judge’s decision was providing the monitor with the same access to certain documents, information, facilities and personnel related to compliance with the Export Control Reform Act of 2018.

Trade sanctions
The court decision relates to false statements made by ZTE during settlement talks and a probationary period in 2017. For the same violation, the US Department of Commerce’s Bureau of Industry and Security issued a denial order in April, which barred US companies from selling components to ZTE for a period of seven years.

ZTE reached a deal with the US government in early June to remove the sanctions, which involved paying a $1 billion fine, placing an additional $400 million in an escrow account with a US bank, appointing a special compliance coordinator and replacing its board of directors.

In March 2017, the company pleaded guilty to charges it illegally shipped US goods to Iran in violation of trade sanctions. ZTE was fined $892 million and agreed to pay an additional $300 million penalty if it violated the terms of a settlement agreement.