According to the Federal Register public inspection files, BIS will publish on March 24, a temporary general license authorizing exports to ZTE Corporation and ZTE Kangxun under the same terms and conditions as were in place prior to the order placing those two companies on the Entity List. This means that, effective March 24, licenses won’t be required for exports to these two entities unless licenses are otherwise required based on the exported item or the proposed end use. The temporary general license, which expires on June 30, 2016, does not include Beijing 8-Star or ZTE Parsian, which were included in the initial designation of ZTE entities.

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The problem with the temporary general license is that there is no assurance that BIS will extend the license beyond that date. If an exporter relying on this license, exports an item to ZTE before June 26 but the license is then revoked, the exporter will be effectively excluded from warranty service on that item. Exporters shipping to ZTE during this regulatory limbo would be well advised to make sure that their contracts with ZTE are modified to prevent warranty claims by ZTE if the general license should, at any time, be revoked.

Photo Credit: ZTE Stand 6 via http://www.zte.com.cn/cn/events/ces2013/show/201301/t20130110_381605.html [Fair Use])