China’s ZTE slams US ban on sales, says company’s survival at risk

ZTE said it regards compliance as the cornerstone of its strategy, adding it invested $50 million in export control compliance projects in 2017 and plans to invest more this year. (Reuters)
Updated 20 April 2018
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China’s ZTE slams US ban on sales, says company’s survival at risk

  • ZTE said it regards compliance as the cornerstone of its strategy, adding it invested $50 million in export control compliance projects in 2017 and plans to invest more this year
  • ZTE said it will not give up efforts to solve problems through communication

HONG KONG: China’s ZTE Corp. said on Friday that a US ban on the sale of parts and software to the company was unfair and threatens its survival, and vowed to safeguard its interests through all legal means.
The US this week imposed a ban on sales by American companies to ZTE for seven years, saying the Chinese company had broken a settlement agreement with repeated false statements — a move that threatens to cut off its supply chain.
“It is unacceptable that BIS insists on unfairly imposing the most severe penalty on ZTE even before the completion of investigation of facts,” ZTE said in its first response since the ban was announced, referring to the US Commerce Department’s Bureau of Industry and Security.
“The Denial Order will not only severely impact the survival and development of ZTE, but will also cause damages to all partners of ZTE including a large number of US companies,” ZTE said in a statement.
ZTE said it regards compliance as the cornerstone of its strategy, adding it invested $50 million in export control compliance projects in 2017 and plans to invest more this year.
A senior US Commerce Department official told Reuters earlier this week that it is unlikely to lift the ban.
“We’re going to have to see how this unfolds. But there is no provision currently for that to occur,” the official said, who declined to be identified due to the sensitivity of the matter.
The Commerce Department has an appeals process for companies to try to get off the list, but it is unclear whether that would be available to ZTE because the case had been previously subject to a settlement, according to people familiar with the matter.
Even so, ZTE would have little recourse in the near term because appeals would have to be approved by the Bureau of Industry and Security, the same agency that issued the ban.
Companies must submit appeals to a committee that would issue a ruling within 30 days, according to the agency’s website.
ZTE said it will not give up efforts to solve problems through communication, and it is determined to take judicial measures to protect the legal rights and interests of the company.
The ban has ratcheted up tensions between China and the United States at a time when they have already threatened each other with tens of billions of dollars in tariffs, fanning worries of a full-blown trade war that.
In China, there has been a patriotic backlash with an outpouring of support for ZTE on social media and most domestic newspapers have chosen to put the lion’s share of the blame for ZTE’s troubles on the country’s heavy reliance on foreign semiconductors.
Meanwhile, the US government is considering using an emergency law to restrict Chinese investments in sensitive US technologies, a senior Treasury official said on Thursday.
Trade in ZTE shares has been suspended since Tuesday. As of Monday’s close, they were worth some $19 billion.


UAE to loosen visa rules for investors and innovators

Updated 21 May 2018
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UAE to loosen visa rules for investors and innovators

  • UAE cabinet announces the launch of an integrated visa system to attract talent and talent in all vital sectors of the national economy
  • The Council also announced changes in the system of foreign ownership of companies in the country, which allows the acquisition of 100% of the global investors by the end of the year

DUBAI: The United Arab Emirates, home to financial hubs Abu Dhabi and Dubai, is loosening its residency laws and will grant long-term visas for up to 10 years to investors and highly-skilled professionals.
The 10-year residency visas will be granted to specialists in science, medicine and research, and to “exceptional students.” The state-run WAM news agency says the plan aims to attract global investment and innovators.
The UAE Cabinet approved the new rules on Sunday, saying plans are also on track to allow foreign investors 100 percent ownership of their UAE-based companies this year.
His Highness Sheikh Mohammed bin Rashid Al Maktoum affirmed that the UAE will remain a global incubator for exceptional talents and a permanent destination for international investors. “The UAE has been open, governed by tolerance and contributed to by all who live on its land.
“Our open environment, tolerant values, infrastructure and flexible legislation offer the best opportunities to attract international investment and exceptional talent in the UAE,” he said. “Our country is the land of opportunity, the best environment for realizing human dreams and unleashing their extraordinary potentials.”
The new regulations include raising the percentage of global investors’ ownership in companies to 100% by the end of the current year. He directed the Ministry of Economy in coordination with the concerned parties to implement the decision and follow up on its developments and submit a detailed study in the third quarter of this year.
The new regulations approved by the Council of Ministers and the authorities concerned have also set the procedures for implementing them to grant investors residence visas of up to ten years for them and all members of their families, as well as granting residency visas of up to ten years for specialized competencies in the medical, scientific, research and technical fields.
The new regulations also include visas for students studying in the country for five years and a 10-year residency for exceptional students.
Under current laws, foreign companies must have an Emirati owning 51 percent of the shares, unless the company operates in a free zone. Major brands Apple and Tesla are believed to be exceptions to the rule.