U.S. Commerce Secretary Wilbur Ross told FOX Business’ Lou Dobbs that the Trump administration’s agreement with Chinese telecom giant ZTE involves more than a monetary penalty.
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“We have made them agree that they will adopt our code of compliance and pay for people we insert into the company to monitor that compliance,” Ross said Thursday.
ZTE Corp. will pay a $1 billion fine to the U.S. plus $400 million in escrow to cover any future violations. The company settled criminal and civil charges last year in connection with violating U.S. sanctions against Iran and North Korea.
Under the agreement, ZTE is required to change its entire board of directors and executive team within 30 days.
Ross said the new executive team will report jointly to the new board chair and to a compliance team handpicked by the Department of Commerce.
“That’s an unprecedented amount of surveillance to put into a company,” he said on “Lou Dobbs Tonight.”
The consequences are in addition to the $892 million in penalties ZTE already paid.
Ross said the punishment against ZTE has changed the behavior of the Chinese telecom company.
“We’ve retained the ability to shut them down if our monitors find that they do anything wrong in future,” he said.