US Commerce Department bans selling China's ZTE

Visitors pass in front of the ZTE Corp. booth at the Mobile World Congress in Barcelona Spain

In conclusion, the measures taken by the U.S. government against the Chinese manufacturer will also reflect on the latter's smartphones production and their quality, subsequently, since now ZTE can't buy Qualcomm chipsets anymore, while, until now, up to 30% of the components used by ZTE were made by United States companies.

ACIA, -35.97% is in Monday after the U.S. Commerce Department said it would prohibit American companies from supplying components to Chinese hardware firm ZTE Corp.

The U.S. has sanctioned China's second-largest maker of telecom equipment for breaching a settlement of allegations that it illegally shipped goods to Iran. As part of the agreement, ZTE said it would dismiss four members of senior staff to discipline 35 more.

The U.S. action could be catastrophic for ZTE since American companies are estimated to provide 25 percent to 30 percent of the components used in ZTE's equipment, which includes smartphones and gear to build telecommunications networks.

As part of the agreement, Shenzhen-based ZTE promised to dismiss four senior employees and discipline 35 others by either reducing their bonuses or reprimanding them, senior USA officials told Reuters.

"ZTE made false statements to the U.S. Government when they were originally caught and put on the Entity List, made false statements during the reprieve it was given, and made false statements again during its probation", Commerce Secretary Wilbur Ross said in a statement provided to TechCrunch.

For third week, Palestinian journalists injured by gunfire covering Gaza protests
They have also injured not less than 3,000 people since the start of protests, according to the reports by Gaza's health ministry. Israel says it is doing what it must to defend its border, and to stop any of the protesters getting across the fence.

The Hong Kong-listed shares of ZTE were suspended on Tuesday.

The UK's National Cyber Security Centre (NCSC) has warned that one of China's biggest telecoms infrastructure and smartphone firms is a national security risk.

The action of the ban imposed by the US on the ZTE corp. means that one of the world's top manufacturers of smart phones and communication gear will not be able to buy technology from American Supplies. The US Department of Commerce also banned the export of software which means its devices may not come with Google Play services or receive updates.

Having suffered a loss of 767.8 million Chinese yuan ($122 million) in 2016, ZTE bounced back with a net profit of more than RMB6.7 billion ($1.1 billion) previous year, with sales up 7.5%, to RMB108.8 billion ($17.3 billion). ZTE already sells both its branded and white-label smartphones via mobile carriers AT&T and Verizon in the US.

The NCSC letter states that new Chinese laws allow the state to exert influence over companies and individuals, with "wide ranging powers of compulsion", according to The Financial Times.

As U.S. concerns about safeguarding its chip technology and cutting its trade deficit grow, the tech sector has become a flashpoint in the broader battle about trade and economic policy, with U.S. President Donald Trump accusing Chinese firms of intellectual property theft for years.

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