Another shoe, so to speak, may be about to drop for Huawei. According to new reporting from The Wall Street Journal, the Justice Department has been investigating a potential violation of U.S. sanctions on Iran by the Chinese smartphone maker.
The probe reflects a similar one into ZTE that landed that device maker in serious hot water. The company was hit with an $892 million fine last year. Earlier this month, the DOJ imposed an even harsher penalty after it deemed ZTE guilty of violating the terms of that agreement, ultimately barring U.S. tech companies from selling to it, a move the smartphone manufacturer said would “severely impact” its survival.
Of course, this isn’t the first time Huawei and ZTE have been on the same side of U.S. government scrutiny. Intelligence agencies have lodged harsh criticism at both over perceived ties to the Chinese government. Huawei, however, has long gotten the short end of that stick, with U.S. carriers and retailers refusing to stock the company’s products, significantly derailing its hopes of tackling the American market.
Details of this new probe are pretty scant at the moment. We’ve reached out to Huawei for comment, but I don’t anticipate much in the way of insight there. It’s probably in the company’s best interest to wait this one out. Of course, in the past, Huawei has made it clear that it feels unfairly targeted by the U.S. government — and there is the broader context of what appears to be a looming trade war between the U.S. and China.
What does seem clear, however, is that things aren’t likely to get much better for Huawei anytime soon with regard to the U.S. market. The company has, understandably, been shifting its global plans, accordingly.
Update: Here’s Huawei’s non-statement statement, “Huawei complies with all applicable laws and regulations where it operates, including the applicable export control and sanction laws and regulations of the UN, US and EU.”