Cisco has ended its sales partnership with ZTE following allegations that the firm sold Cisco-branded equipment to Iran, according to reports.
Reuters reported Cisco began its investigation into China-based firm ZTE following allegations that the company sold Cisco networking equipment to the Telecommunication Company of Iran last July.
These assertions sparked to investigations from the FBI, the US Department of Commerce, and now Cisco.
"ZTE is highly concerned with the matter and is communicating with Cisco," ZTE spokesman David Dai Shu told Reuters.
"At the same time, ZTE is actively co-operating with the US government about the probe to Iran. We believe it will be properly addressed."
Cisco's decision brings an end to its seven-year partnership with ZTE. According to Reuters, ZTE brought the partnership together as a way to strengthen its enterprise opportunities in China and Asia Pacific.
Five years ago the partnership expanded when Cisco decided ZTE could help it combat China-based telecommunications firm Huawei in emerging markets. Cisco would reportedly license technology to ZTE, who would build equipment locally as a way to reduce manufacturing costs.
When V3 contacted Cisco about the reports of the ended partnership a company spokesperson would only say, "Cisco has no current relationship with ZTE."
ZTE has had a controversial year up to this point. The US Congressional Intelligence Committee recently declared that both ZTE and Huawei could not be trusted because of their close ties to the Chinese government.
Mobile software company Vringo also recently hit ZTE with a patent infringement lawsuit. Vringo is accusing ZTE of violating three patents pertaining to cellular networking technology.
"ZTE's liability will continue to increase as long as the issue remains unresolved," Vringo chief operating officer Alexander Berger said in a statement.
"We hope that ZTE will work with us to resolve this matter in a positive and productive manner."
Following news of the lawsuit stock in Vringo rose over 20 percent.
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