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May, 2018 5:32 AM



US ban hits Telstra phone supplier

US ban hits Telstra phone supplier

Telstra has been forced to stop selling some pre-paid branded mobile phones after the Chinese manufacturer was hit by US sanctions.

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By AAP 10.05.2018 12:52 PM

Telstra has been forced to stop selling some of its own-brand pre-paid mobile phones after the Chinese manufacturer was hit by US sanctions for selling telecommunications equipment to Iran and North Korea.

Chinese company ZTE ceased some of its operations after the United States Department of Commerce slapped an export ban on the company in April.

On Thursday Telstra announced it had stopped selling 22 Telstra-branded phones and wifi dongles made for it by ZTE.

"This follows the announcement last month of a denial order that prohibits U.S. companies from selling device components and software to ZTE and which now prevents ZTE from manufacturing devices for our range," Telstra head of innovation, strategy, Michele Garra said in a statement on Telstra's website.

ZTE, China's second largest telecommunications maker after Huawei, fell foul of US authorities for a breach of a suspended penalty agreement made after pleading guilty in March, 2017, to illegally shipping equipment that included US-sourced components to Iran and North Korea.

At the time ZTE agreed to pay a $US1.19 billion ($A1.59 billion) fine and adhere to a suspended seven-year denial of export order that prohibits US companies from selling it device components and software.

In April US Secretary of Commerce Wilbur Ross said the suspension was removed because ZTE made false statements, failed to remove its accountable executives and covered up that it paid full bonuses to the employees that had engaged in illegal conduct.

Telstra said customers already using ZTE made devices will not be affected by the sales withdrawal.

Other Telstra-branded smartphones made by Huawei and other suppliers are still available for sale.

In a statement on its website,Telstra will contact affected customers and apologised for the "temporary reduction in device options".

"We are hopeful that ZTE will be able to reach a resolution to this matter soon so that we can recommence selling Telstra-branded ZTE devices," Ms Garra said.

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