China steals our intellectual proprety all the time.
When Apple does a deal with Apple to make phones in China, they steal all the intellectual property that goes
into building an iphone and then they copy it. ZTE phones are iphones. The Chinese just takes the iphone copiese it and puts another name on it.
They also use hackers to break into our tech companies and car manufacturers etc and steal intellectual property that way.
ZTE phones were banned in the US because they are essentially iphones with Chinese Spying software installed on them. Not only do they massively steal from Apple,
the phones are designed to be insecure spy devices for the Chinese Government.
Zhongxing Telecommunications Equipment isn't a household name in most places. Known as ZTE, it is probably best known for making cheap smartphones that are mostly sold in developing countries, though it also sells them in the United States.
But in the telecommunications world, the ZTE name carries significant weight. It is one of two Chinese companies — Huawei is the other — that sells equipment for cellular networks. It has about 75,000 employees and says it does business in more than 160 countries.
That makes it an important geopolitical pawn for Beijing, both as an innovator and as a builder of state-funded projects overseas. If China wants to improve ties with a government in the developing world, it often offers loans that can be used to set a ZTE-powered cellular network.
Longer term, China hopes that companies like ZTE will become powerhouses that can help the country wean itself from a reliance on American tech firms, which Beijing views as security threats because of the possibility that they could help Washington spy.
The irony is that ZTE is designed to spy. China wants all these countries to install their cellular network because then they'll spy on all these other countries too. They want everyone to use their phones, because
then they can spy on people with the phones.
When the Commerce Department released its findings against ZTE in 2016, it took the rare step of disclosing evidence of the company's guilt - ZTE was selling phones to "all five major embargoed countries — Iran, Sudan, North Korea, Syria and Cuba."
A second ZTE company document featured flow charts for best practices to circumvent American sanctions. Last year, ZTE acknowledged its guilt and paid a $1.19 billion fine.
Last month, officials said ZTE had violated its agreement with the United States because it didn't punish senior management for having violated the sanctions. Instead, the Commerce Department said, ZTE paid them bonuses and lied about it. As punishment, the department forbade American technology companies from selling their products to ZTE for seven years.
That means no Qualcomm chips or Android software for its phones, and no American chips or other components for its cellular gear. Analysts estimate that four-fifths of ZTE's products have American companies. ZTE went into a tailspin, saying last week that it had shut down major operations.
Donald Trump has suddenly intervened on behalf of China to save ZTE phones. The American president hasn't explained his decision to try to help the company, other than to cite the potential for lots of Chinese workers to lose their jobs.
The real reason Donny is changing course and helping China is that Putin is running out of money because the Russian economy is based on oil and oil prices
are not doing well. Since Putin ran out of money, Trump is looking for someone else to fund his graft. China and ZTE phones are paying Trump a shit load
so he'll reverse the ban for them.
U.S. President Donald Trump on Tuesday floated a plan to fine ZTE Corp and shake up its management as his administration considered rolling back more severe penalties that have crippled the Chinese telecommunications company.
Trump's proposal ran into immediate resistance in Congress,
where Republicans and Democrats accused the president of bending to pressure from Beijing to ease up on a company that has admitted to violating sanctions on Iran.
The Senate Banking Committee also voted 23-2 to make it harder for the president to modify penalties on Chinese telecommunications firms, drawing the support of liberal Democrats like Chris Van Hollen and conservative Republicans like Tom Cotton.
The Republican-controlled House of Representatives is weighing a proposal that would block the sale of ZTE products and those of another Chinese company, Huawei Technologies [HWT.UL], until national security officials certify they are safe. It would be added to a defense-policy bill that Congress typically passes each year.
The U.S. government was well aware of China's aggressive strategy of leveraging private investors to buy up the latest American technology when, early last year, a company called Avatar Integrated Systems showed up at a bankruptcy court in Delaware hoping to buy the California chip-designer ATop Tech.
ATop's product was potentially groundbreaking - an automated designer capable of making microchips that could power anything from smartphones to high-tech weapons systems. It's the type of product that a U.S. government report had recently cited as "critical to defense systems and U.S. military strength." And the source of the money behind the buyer, Avatar, was an eye-opener: Its board chairman and sole officer was a Chinese steel magnate whose Hong Kong-based company was a major shareholder.
Despite those factors, the transaction went through without an assessment by the U.S. government committee that is charged with reviewing acquisitions of sensitive technology by foreign interests.
In fact, a six-month POLITICO investigation found that the Committee on Foreign Investment in the United States, the main vehicle for protecting American technology from foreign governments, rarely polices the various new avenues Chinese nationals use to secure access to American technology, such as bankruptcy courts or the foreign venture capital firms that bankroll U.S. tech startups.
The committee, known by its acronym CFIUS, isn't required to review any deals, relying instead on outsiders or other government agencies to raise questions about the appropriateness of a proposed merger, acquisition or investment. And even if it had a more formal mandate, the committee lacks the resources to deal with increasingly complex cases, which revolve around lines of code and reams of personal data more than physical infrastructure.
"I knew what was critical in 1958 — tanks, airplanes, avionics. Now, truthfully, everything is information. The world is about information, not about things," said Paul Rosenzweig, who worked with CFIUS while at the Department of Homeland Security during President George W. Bush's second term. "And that means everything is critical infrastructure. That, in some sense, means CFIUS really should be managing all global trade."
As a senior official at the Treasury Department, which oversees CFIUS, put it: "Any time we see a company that has lots of data on Americans - health care, personal financial data - that's a vulnerability."
When CFIUS was formed, in the 1970s, the companies safeguarding important technology were so large that any takeover attempt by foreigners would be certain to attract attention. Now, much of the cutting-edge technology in the United States is in the hands of much smaller firms, including Silicon Valley startups that are hungry for cash from investors.
The gap in oversight became a more urgent problem in 2015, when China unveiled its "Made in China 2025" strategy of working with private investors to buy overseas tech firms. A year earlier, Chinese investments in U.S. tech startups had totaled $2.3 billion, according to the economic research firm CB Insights. Such investments immediately skyrocketed to $9.9 billion in 2015. These amounts dipped the following year, as the Obama administration voided a high-profile deal, but analysts say China's appetite to buy U.S. firms and technology is still strong. In 2017, there were 165 Chinese-backed deals closed with American startups, only 12 percent less than the 2015 peak.
Yet the failure to investigate some forms of Chinese investments in American technology has flown under the radar as President Donald Trump goes tit for tat with Beijing, imposing tariffs meant to punish China for unfair trade practices. Critics noted on Monday that Trump's tentative agreement to drop his tariff threat in exchange for Chinese pledges to purchase billions of dollars more in American goods avoided any mention of the outdated foreign-investment policies that have alarmed lawmakers across the political spectrum.
On the Senate floor Monday, Minority Leader Chuck Schumer (D-N.Y.) lashed out at Trump's approach.
"China's trade negotiators must be laughing themselves all the way back to Beijing," he said. "They're playing us for fools — temporary purchase of some goods, while China continues to steal our family jewels, the things that have made America great: the intellectual property, the know-how in the highest end industries. It makes no sense."
National security specialists insist that such a stealth transfer of technology through China's investment practices in the United States is a far more serious problem than the tariff dispute — and a problem hiding in plain sight. A recent Pentagon report bluntly declared: "The U.S. does not have a comprehensive policy or the tools to address this massive technology transfer to China." It went on to warn that Beijing's acquisition of top-notch American technology is enabling a "strategic competitor to access the crown jewels of U.S. innovation."
Some congressional leaders concur. Senate Majority Whip John Cornyn (R-Texas) regularly warns his colleagues that China is using private-sector investments to pilfer American technology. China has "weaponized" its investments in America "in order to vacuum up U.S. industrial capabilities from American companies," Cornyn said at a January hearing. The goal, he added, is "to turn our own technology and know-how against us in an effort to erase our national security advantage."