The Grand Memo Lite and Grand S ZTE smartphones . Picture: REUTERS
The Grand Memo Lite and Grand S ZTE smartphones . Picture: REUTERS

Washington — The US House voted to punish China’s ZTE as part of an annual defence policy bill, as US Congress pressures US President Donald Trump not to weaken sanctions on the telecomms equipment maker accused of violating trade-sanction agreements and posing a threat to US national security.

The defence measure passed on a 351-66 vote on Thursday. It would ban government agencies from using technology made by ZTE and would prohibit the US defence Department from renewing contracts with vendors that work with the Chinese company. It would also bar government use of Chinese-made video surveillance equipment.

The measure also would apply to several other Chinese companies, including Hytera Communications, Hangzhou Hikvision Digital Technology, and Zhejiang Dahua Technology.

ZTE became a flash point in US-China relations after the administration crippled the company by cutting it off from US suppliers for allegedly violating terms of a 2017 settlement over Iran and North Korea sanctions violations, and then lying about it. The US alleges the state-linked enterprise is abetting the transfer of US technology to China’s military.

The legislation illustrates growing congressional opposition to Trump’s reconsideration of penalties against ZTE as a favour to the country’s President Xi Jinping, after the company estimated losses of at least $3.1bn from a US technology ban.

Trump has said he would "envision" a revised penalty for the company, including a requirement that it appoint a new board of directors and pay a "very large fine" of perhaps $1.3bn.

On Wednesday, US secretary of state Mike Pompeo told the House foreign affairs committee that the administration would devise a plan to reduce the risks to the US posed by ZTE. "We’re going to get this right," he said.

The defence policy bill passed Thursday is HR 5515.

In the Senate, the banking committee approved a bill on Wednesday including language that would require Trump to certify to Congress that US security wouldn’t be jeopardised before lifting civil penalties against ZTE. Second-ranking Republican John Cornyn of Texas wants to add the measure to the Senate’s annual defence policy bill being considered by the armed services committee.

Bloomberg