Reuters is reporting that Chinese manufacturer ZTE has come under investigation from the US Department of Commerce for allegedly shipping embargoed American hardware and software products to Iran. A Commerce Department official confirmed that US authorities have been pursuing the matter "very aggressively," though it will likely be many months before the investigation is complete. If ZTE is found to have violated the embargo, it could face fines at up to double the value of the products in question.
News of the investigation comes following a March 22nd report that ZTE had signed a contract to ship $123.4 million worth of US-made products to Telecommunication Company of Iran (TCI). The contract, signed in December 2010, included printers and PC parts from HP, Windows software, Oracle database products, Dell monitors, and antivirus software from Symantec.
Reuters followed up with an April report that ZTE had signed a separate contract in June 2011 to provide an additional $10 million worth of products to Aryacell — part of the consortium that, along with the Iranian government, controls TCI. The list of components included IBM servers and Cisco switches, among other US-made equipment.
A ZTE spokesman confirmed in March that that company would "curtail" existing business with Iran, and the manufacturer later announced that it would seek no new customers within the country. The company also said in April that it decided to abandon its Aryacell deal after "we realized that the contract involved some U.S. embargoed products."
ZTE officials declined to comment on this week's report, as did representatives from Microsoft, IBM, HP, Oracle, and Dell. These US companies had previously said they were unaware of these Iranian contracts, though sources close to the matter tell Reuters that some have already received subpoenas related to their dealings with both ZTE and Beijing 8-Star — a company that provided "relevant third-party equipments," according to contract documents
The investigation is still in its early stages, but an official from the Commerce Department tells Reuters that there's so far no evidence that any US firms were complicit in ZTE's Iranian affairs.