ZTE and Huawei Proclaim Innocence During House Hearings

Posted by at 5:38 pm on September 17, 2012
Category: Iran Sanctions

Huawei HQLast Thursday the House Intelligence Committee held hearings into whether or not two giant Chinese telcom equipment companies — ZTE and Huawei — had shipped U.S. origin goods to Iran in violation of the U.S. economic sanctions on Iran. ZTE told the committee that it had never sold equipment to the “Iranian government,” apparently feeling that this was some defense to sales that it apparently made to state-owned telecom companies in Iran.

More interestingly, and more surprisingly, Huawei offered this novel interpretation of U.S. sanctions on Iran:

Charles Ding, a senior vice president of Huawei, also testified Thursday. He said the only equipment his company has sold to Iran was for “commercial, civilian” use.

Of course, U.S. sanctions also cover sales of items for “commercial, civilian” use.

The report on the hearing in the Washington Post, linked above, tries unsuccessfully to give Ding the benefit of the doubt and, in so doing, commits a howler of its own.

Legal experts said it is unclear whether that would violate U.S. sanctions barring sales to Iran … . Although foreign companies have the ability to do business with Iran, federal law bars involvement by U.S. subsidiaries or the sale of goods made in the United States without special permission.

Apparently the reporter is trying to suggest that if these sales were made by Huawei, and not one of its U.S. subsidiaries, everything would be hunky dory. Uh, no. If the items had more than 10 percent U.S.-origin content, then even foreign companies are not permitted to sell those items to Iran. You have to wonder what legal “experts” the Post reporter consulted.


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Copyright © 2012 Clif Burns. All Rights Reserved.
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One Comment:

In reading the Washington Post article it seems Rep. Myrick is also uncertain (along with the executive from Huawei) about whether “commercial goods” are allowable under the laws. To hold a hearing without basic knowledge shouldn’t surprise me but it still does.

By the way, I think the Washington Post and the Smoking Gun have a partnership or are owned by the same company. It’s interesting the Post doesn’t have any more information in their story.

Comment by LDM on September 17th, 2012 @ 6:29 pm