For those who came in late, the US has banned US companies from supplying ZTE which puts most of the latest technology out of ZTE's reach. ZTE's ban was mostly due to it breaking a trade embargo with Iran, and now it seems that US prosecutors see if it can find some similar dirt on Huawei.
According to Reuters since at least 2016, U.S. authorities have been probing Huawei’s alleged shipping of US-origin products to Iran and other countries in violation of US export and sanctions laws.
Huawei, the world’s largest maker of telecommunications network equipment and the number three smartphone supplier, said it complies with “all applicable laws and regulations where it operates, including the applicable export control and sanction laws and regulations of the UN, US and EU”. US authorities have subpoenaed Huawei seeking information related to possible export and sanctions violations, two sources said.
Both companies also have been under scrutiny by US lawmakers over cybersecurity concerns.
In Beijing, foreign ministry spokeswoman Hua Chunying said China opposed countries imposing their laws on others when asked whether Huawei violated US sanctions related to Iran.
“China’s position opposing nations using their domestic laws to impose unilateral sanctions is consistent and clear”, she told a daily news briefing.
“We hope that the United States will not take actions that further harm investors’ mood towards the business situation there.”
Republican Senators Marco Rubio and Tom Cotton have introduced legislation that would block the US government from buying or leasing telecommunications equipment from Huawei or ZTE, citing concern that the Chinese companies would use their access to spy on US officials. In 2016, the Commerce Department made documents public that showed ZTE’s misconduct and also revealed how a second company, identified only as F7, had successfully evaded US export controls.
In a 2016 letter to the Commerce Department, 10 US lawmakers said F7 was believed to be Huawei, citing media reports. In April 2017, lawmakers sent another letter to Commerce Secretary Wilbur Ross asking for F7 to be publicly identified and thoroughly investigated.