Acacia says ZTE industry to stay suspended till ban lifted

Acacia says ZTE business to remain suspended until ban lifted

(Reuters) - Acacia Communications Inc’s supply agreement with ZTE Corp will remain suspended until the U.S. Department of Commerce implements its recent settlement with the Chinese firm, the U.S. company said on Tuesday.

FILE PHOTO - Visitors pass in front of the Chinese telecoms equipment group ZTE Corp booth at the Mobile World Congress in Barcelona, Spain, February 26, 2018. REUTERS/Yves Herman/File Picture

The settlement, which was made public on Monday, would allow China’s No. 2 telecommunications equipment maker to resume business with U.S. suppliers.

But the ban on buying U.S. parts, imposed by the department in April, will not be lifted until ZTE pays fines and places $400 million more in an escrow account in a U.S.-approved bank.

Acacia said the settlement may ultimately allow it to resume ties with ZTE.

The company’s shares have fallen 13 percent since the ban was imposed in April.

Reporting by Sonam Rai in Bengaluru; Editing by Saumyadeb Chakrabarty

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Technology

September 30, 2018