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China's ZTE pleads guilty to selling US tech to Iran

The telecom equipment maker may be on the hook for as much as $1.2 billion for violating sanctions against Iran.

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ZTE has pleaded guilty to violating sanctions against shipping US technology to Iran and agreed to pay up to $1.2 billion in fines and forfeiture.

Manuel Blondeau/AOP.Press/Corbis, Corbis via Getty Images

ZTE has agreed to pay up to $1.2 billion in fines as part of a guilty plea to violating sanctions prohibiting sales of US technology to Iran.

The Chinese telecommunications equipment maker agreed to pay $892 million in fines and forfeitures for violating the International Emergency Economic Powers Act and obstruction of justice, the US Department of Justice said Wednesday. The company will face an additional $300 million in penalties if it violates the terms of the agreement.

Restrictions against tech exports to Iran have been in place since the early 1980s when the US broke off diplomatic relations with Iran. However, many sanctions have recently been imposed on Iran over its controversial nuclear program.

ZTE has been in the doghouse with US authorities since March 2016 when the Commerce Department accused it of violating rules restricting exports of US technology to Iran. The US government slapped the company with sanctions that hurt the Chinese company's ability to get access to US technology needed for its telecommunications products.

The US government lifted those sanctions in August, allowing the company to continue working with US technology suppliers.

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