The US government has announced that it signed an agreement with the Chinese smartphone maker ZTE that will clear the way for the firm to resume operations following an almost three-month ban on doing business with American suppliers.
The US Commerce Department noted that the ban will be officially lifted once the Chinese company deposits $400m in an escrow account.
The ban was first imposed in April and it led to ZTE shutting down its operations while also causing further friction between the US and China's escalating trade war.
Last month the firm reached an agreement with the Commerce Department in which it would pay a $1.4bn to regain access to the US suppliers it depends on for the components used in its smartphones and networking gear.
The new settlement requires ZTE to pay a $1bn penalty and deposit funds into an escrow account. While the firm paid the penalty to the US Treasury last month, the US government could seize the funds in escrow if the company violates the latest settlement.
ZTE is also required to change its board and management within 30 days under the new settlement. For the next 10 years, the firm will operate under a suspended ban.
ZTE is expected to restart major operations once the ban is lifted.
Image Credit: Flickr / Kārlis Dambrāns