White House's Navarro says 'three strikes you're out' for ZTE

WASHINGTON (Reuters) - Chinese technology company ZTE Corp will be “shut down” in the United States if it engages in one more bad activity, White House trade adviser Peter Navarro warned on Sunday.

FILE PHOTO - White House trade and manufacturing adviser Peter Navarro (L), a member of the U.S. trade delegation to China, leaves a hotel in Beijing, China May 3, 2018. REUTERS/Jason Lee

ZTE last week agreed to pay a $ 1 billion fine to the United States and to overhaul its leadership in order to end a crippling ban on the Shenzhen-headquartered firm from buying parts from U.S. suppliers and allowing it to get back into business.

The ban, which traces back to a breach of the U.S. embargo on trade with Iran, had prevented China’s second largest telecoms equipment maker by revenue from buying the U.S. components it relies on to make phones and other devices.

“It’s going to be three strikes you’re out on ZTE. If they do one more additional thing, they will be shut down,” Navarro told Fox, adding that everyone within the administration understood this was the policy.

FILE PHOTO - Visitors pass in front of the Chinese telecoms equipment group ZTE Corp booth at the Mobile World Congress in Barcelona, Spain, February 26, 2018. REUTERS/Yves Herman/File Picture

Navarro was speaking as President Donald Trump arrived in Singapore for a historic summit with North Korean leader Kim Jong Un, whose regime is heavily dependent upon neighboring communist ally China.

The United States introduced the ban in April because ZTE broke the terms of an agreement it had entered into with the U.S. government after pleading guilty last year to conspiring to violate U.S. sanctions by shipping U.S. goods to Iran.

FILE PHOTO: A ZTE smart phone is pictured in this illustration taken April 17, 2018. REUTERS/Carlo Allegri/Illustration/File Photo

The ZTE sanctions became a key focus in trade talks between Washington and Beijing, and a deal to lift the ban was struck as Trump sought concessions from China in order to avoid a trade war between the world’s two largest economies.

Prominent U.S. Democratic and Republican lawmakers last week introduced legislation to try to overturn the deal, saying ZTE posed a threat to America’s national security.

On Sunday, Navarro said Trump’s decision to allow ZTE to continue operating in the United States was a gesture to help build goodwill with China.

“The President did this as a personal favor to the president of China as a way of showing some good will for bigger efforts such as the one here in Singapore,” said Navarro, referring to the summit between Trump and Kim.

He added that ZTE was a “bad actor” but that the deal included safeguards, such as requiring the company to retain a compliance team selected by the Commerce Department for 10 years. The company already has a U.S. court-appointed monitor.

Reporting by Michelle Price; Editing by Lisa Shumaker and Chris Reese

Tech

U.S. sends rules on drone regulation to White House for review

WASHINGTON (Reuters) - The U.S. Transportation Department has sent two proposed rules to the White House to regulate the increased use of unmanned aerial vehicles, the agency said on Tuesday as it prepared to unveil the winners of new drone pilot projects.

One of the new rules would allow drones to fly over people while the other would allow for remote identification and tracking of unmanned aircraft in flight. After both are formally proposed, it would take months or even more than a year before they are finalized.

Current rules prohibit nighttime drone flights or operations over people without a waiver from the Federal Aviation Administration. The FAA has no requirements or voluntary standards for electrically broadcasting information to identify an unmanned aircraft.

The FAA has said regulations are necessary to protect the public and the National Airspace System from bad actors or errant hobbyists. Several incidents around major airports have involved drones getting close to aircraft.

The National Transportation Safety Board said in December a September collision between a small civilian drone and a U.S. Army helicopter was caused by the drone operator’s failure to see the helicopter because he was intentionally flying the drone out of visual range.

The helicopter landed safely but a 1-1/2 inch (3.8 cm) dent was found on the leading edge of one of its four main rotor blades and parts of the drone were found lodged in its engine oil cooler fan.

Later on Tuesday, U.S. Transportation Secretary Elaine Chao will unveil the winners for 10 drone projects involving cities, universities, an Indian tribe, counties and states. Reuters reported Tuesday that major technology and aerospace companies including Amazon.com Inc, Apple Inc, Intel Corp, Qualcomm Inc and Airbus SE are vying to take part in the new slate of drone tests.

The wide interest in the U.S. initiative, launched by President Donald Trump last year, underscores the desire of a broad range of companies to have a say in how the fledgling industry is regulated and ultimately win authority to operate drones for purposes ranging from package delivery to crop inspection.

Reporting by David Shepardson; Editing by Richard Chang

Tech