The story
ZTE, initially founded as Zhongxing Semiconductor Co., Ltd in Shenzhen, Guangdong province, in 1985, was incorporated by a group of investors associated with China's Ministry of Aerospace Industry. In March 1993, Zhongxing Semiconductor changed its name to Zhongxing New Telecommunications Equipment Co., Ltd with capital of RMB 3 million, and created a new business model as a "state-owned and private-operating" economic entity. ZTE made an initial public offering (IPO) on the Shenzhen stock exchange in 1997 and another on the Hong Kong stock exchange in December 2004.
While the company initially profited from domestic sales, it vowed to use proceeds of its 2004 Hong Kong IPO to further expand R&D, overseas sales to developed nations, and overseas production. Making headway in the international telecom market in 2006, it took 40% of new global orders for CDMA networks topping the world CDMA equipment market by number of shipments. That same year also saw ZTE find a customer in the Canadian Telus and membership in the Wi-Fi Alliance.
By 2009, the company had become the third-largest vendor of GSM telecom equipment worldwide, and about 20% of all GSM gear sold throughout the world that year was ZTE branded. As of 2011, it holds around 7% of the LTE patents.
In 2022, US court rules ZTE to end the five-year probation from a 2017 guilty plea.
In 2023, the World Intellectual Property Organization (WIPO)'s Annual PCT Review ranked ZTE's number of patent applications published under the PCT System as 11th in the world, with 1,738 patent applications being published during 2023.
In April 2025, U Mobile announced collaboration with ZTE to deploy Malaysia's second 5G network, with ZTE responsible for the 5G network in East Malaysia.
U.S. sanctions and import ban
In March 2017, ZTE pleaded guilty to illegally exporting U.S. technology to Iran and North Korea in violation of trade sanctions, and was fined a total of US$1.19 billion by the U.S. Department of Commerce. It was the largest-ever U.S. fine for export control violations.
ZTE was allowed to continue working with U.S. companies, provided that it properly reprimand all employees involved in the violations. However, the Department of Commerce found that ZTE had violated these terms and made false statements regarding its compliance, having fired only 4 senior officials and still providing bonuses to 35 other employees involved in the violations. On 16 April 2018, the Department of Commerce banned U.S. companies from providing exports to ZTE for seven years. At least 25% of components on recent ZTE smartphones originated from the U.S., including Qualcomm processors and certified Android software with Google Mobile Services. An analyst stated that it would take a significant amount of effort for ZTE to redesign its products as to not use U.S.-originated components.
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On 9 May 2018, ZTE announced that, although it was "actively communicating with the relevant U.S. government departments" to reverse the export ban, it had suspended its "major operating activities" (including manufacturing) and trading of its shares. On 13 May 2018, U.S. president Donald Trump stated that he would be working with CCP General Secretary Xi Jinping to reverse the ban. It was argued that the export ban was being used as leverage by the United States as part of an ongoing trade dispute with China. On 7 June 2018, ZTE agreed to a settlement with the Department of Commerce in order to lift the import ban. The company agreed to pay a US$1 billion fine, place an additional US$400 million of suspended penalty money in escrow, replace its entire senior management, and establish a compliance department selected by the department.
Later that month, the U.S. Senate passed a version of the National Defense Authorization Act for Fiscal Year 2019 that blocked the settlement, and banned the federal government from purchasing equipment from Huawei and ZTE (citing them as national security risks due to risks of Chinese government surveillance). The settlement was criticized by Senators as being "personal favors" between Trump and the Chinese government, as the Chinese government issued a loan for an Indonesian theme park project with a Trump golf course following the May 2018 announcement. However, the House version of the bill, signed by Trump, did not include the provision blocking the settlement, but still included the ban on federal purchase of Huawei and ZTE products.
On 13 July 2018, the denial order was officially lifted.
In January 2019, it became public that ZTE has retained the services of former senator Joe Lieberman as a lobbyist.
In June 2020, the Federal Communications Commission (FCC) designated ZTE as a threat to U.S. communications networks. In July 2020, the U.S. government banned companies that use ZTE from receiving federal contracts. The FCC denied the company's appeal of the decision in November 2020.
In September 2020, the U.S. Department of Justice filed a criminal complaint against ZTE accusing it of using two shell companies named Ryer International Trading and Rensy International Trading to violate sanctions against North Korea. In December 2020, the U.S. Congress included $1.9 billion to help telecom carriers in rural areas of the U.S. to remove ZTE equipment and networks they had previously purchased.
In January 2021, Gina Raimondo, President Joe Biden's nominee for United States Secretary of Commerce, said in her confirmation hearings that she would protect U.S. networks from interference by Chinese companies including ZTE. In June 2021, the FCC voted unanimously to prohibit approvals of ZTE gear in U.S. telecommunication networks on national security grounds.
In March 2022, ZTE was accused of violating its probation from its guilty plea for sanctions violations. After President Joe Biden signed into law the Secure Equipment Act of 2021, in November 2022, the FCC banned sales or import of equipment made by ZTE for national security reasons.
In March 2025, the FCC opened an investigation into ZTE and other Chinese companies regarding operations in the U.S. in violation of restrictions.
Bribery investigation
In 2020, it was disclosed that the United States Department of Justice opened an investigation into ZTE for potential violations of the Foreign Corrupt Practices Act.
From Wikipedia’s article on ZTE, shared under CC BY-SA 4.0.5