In yesterday's Wall Street Journal, Juro Osawa [ U.S. Seeks Huawei Records on Dealings With Sanctioned Nations ] says:
"The U.S. Commerce Department has subpoenaed Huawei Technologies Co., demanding that the Chinese telecommunications giant submit all information on its export and re-export of technological goods to Iran, North Korea and other sanctioned nations, a person with knowledge of the matter said."
What we are seeing is the fallout from the sanctions levied and removed from ZTE, the Chinese technology giant. ZTE internal documents described a series of methods to avoid U.S. export controls, methods that are much like the setting up of shell companies listed in the so-called Panama papers. Using front companies allows them to get banned goods to Iran and North Korea. Those internal documents also alluded to another company that did the same thing. It looks like the inquiry will pursue whether that was Huawei.
ZTE and Huawei have a long history of working together and using the same methods to dig deep into the infrastructure of various countries in the world, often with cooperating host businesses in those countries. This all looks like normal business, unless and until they start using shell companies to distribute those goods to banned countries. This is just the beginning of the investigation and we should be skeptical about it going anywhere. The Obama Administration stopped the sanctions on ZTE within a week of them being brought. Let's hope they can do better this time, but don't count on it.
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