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Cisco Systems, Inc.

Cisco Systems, Inc.

Industry: 
Electronics, Telecommunications
Value of USG Contracts: 
62
Symbol: 
NASDAQ:CSCO
States: 
CA
Country: 
USA
Contact Information: 
Sources: 

According to its website, Cisco is "the worldwide leader in networking that transforms how people connect, communicate and collaborate.” (Company Website)

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"However the repercussion are already being felt, with Cisco reportedly ending all sales agreements with the Chinese firm." (The Register, "Iran blamed for ZTE's 260 PER CENT profit slump," 10/15/2012)

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"Cisco Systems Inc. has ended a longstanding sales partnership with ZTE Corp after an internal investigation into allegations that the Chinese telecommunications equipment maker sold Cisco networking gear to Iran. Cisco's probe followed stories by Reuters in March and April that documented how Shenzhen, China-based ZTE had sold banned computer equipment from Cisco and other U.S. companies to Iran's largest telecom firm. ZTE also agreed last year to ship millions of dollars worth of additional U.S. tech products, including Cisco switches, to a unit of the consortium that controls the telecom firm... David Dai Shu, a ZTE spokesman, said of Cisco's decision to cut ties: 'ZTE is highly concerned with the matter and is communicating with Cisco. At the same time, ZTE is actively cooperating with the U.S. government about the probe to Iran. We believe it will be properly addressed.'... In a recent interview, John Chambers, Cisco's chief executive, declined to discuss the results of the company's investigation of ZTE's sales to Iran. But he said Cisco doesn't "tolerate any direct or indirect" sales of its equipment to embargoed countries such as Iran. 'And when that occurs, we step up and deal with it very firmly. So I think you can assume that you will not see that happen again.' Cisco and ZTE partnered for the past seven years in a relationship that was at times rocky, according to a former Cisco executive with knowledge of the matter... The partnership expanded about five years ago when Cisco began viewing ZTE as a means to combat Huawei, the world's second-biggest maker of telecoms equipment by revenue after Sweden's Ericsson. Huawei had been beating out Cisco in emerging markets by offering significantly cheaper products. Part of Cisco's strategy, the former Cisco executive said, was 'we would license technology to ZTE and they would produce equipment locally, and we could therefore have a range of equipment in the marketplace that would be cost-competitive with Huawei.' ZTE was 'reasonably successful' in reselling Cisco products inside China, where it was well entrenched in the marketplace, the former executive said. But the plan to develop projects jointly, and offer them in markets such as Africa, floundered...  By 2010, the partnership had basically ended, although ZTE continued as an authorized distributor and reseller of Cisco products, according to a person familiar with the matter. The ZTE spokesman did not comment on its relationship with Cisco. ZTE has continued to do business in Iran where American-made tech products long have been subject to U.S. sanctions. A parts list dated July 2011 for an equipment contract between ZTE and Telecommunication Co of Iran (TCI) included several Cisco switches. ZTE later agreed to sell five Cisco switches to a unit of the consortium that controls TCI, according to documents reviewed by Reuters." (Reuters, "Exclusive: Cisco cuts ties to China's ZTE after Iran probe," 10/8/2012)

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Business Monitor International states, “Cisco Systems Inc (USA) designs, develops, manufactures and provides technical support for high performance computer networking products and systems. The company specialises in end-to-end networking solutions and is aimed at three key markets - enterprises, service providers and commercial.” (Business Monitor International)

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"MTN Irancell, a joint venture between MTN Group Ltd of South Africa and an Iranian government-controlled consortium, sourced equipment from Sun Microsystems Inc, Hewlett Packard Co and Cisco Systems Inc, the documents and interviews show. MTN owns 49% of the joint venture but provided the initial funding... The document also includes lists of network equipment, including Cisco routers, Sun servers and products from HP... Two companies - Oracle Corp, which owns Sun, and Cisco - said they were investigating the matter... A spokesman for Cisco said: 'Cisco complies with all US export laws and requires our business partners to expressly acknowledge that they too must abide by these laws. We have been unable to find any information suggesting that Cisco employees were aware of any sales of Cisco equipment to Iran. We continue to investigate this matter, as any violation of U.S. export controls is a very serious matter.'... Mahmoud Tadjallimehr, a former project manager at MTN Irancell, said in an interview he was present when the telecom carrier obtained more than 10 Cisco routers and numerous switches in 2007 to route communications traffic... Asked how the local Iranian company obtained Cisco products, he said: 'How they got into the country, this is another story. I don't have any idea and I don't want to know.'" (Reuters, "Iranian cell-phone carrier obtained banned U.S. tech," 6/4/2012)
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"This license authorizes the company to help the New Zealand Embassy in Iran with a computer project." (New York Times, "Licenses Granted to U.S. Companies Run the Gamut," 12/24/10)

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The Business Monitor International lists Cisco of Iran, based in Tehran, as a subsidiary of Cisco Systems, USA.  (Business Monitor International)

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In its Partner Catalog, Cisco has an entry for “Iran (Islamic Republic of)” with 24 Cisco Technology Developer Partners and one Cisco Solutions Partner. (Company Website)

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The Cisco Learning Network includes the Iran Networking Academy as one of its groups. (Company Website)

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Cisco of Iran (ICCO) is listed as on a page of Iranian companies. (Iranian Company Website)

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Cisco’s Export and Contract Compliance page cites Cisco’s compliance with American regulations, including Export Administration Regulations and Wassenaar Arrangement. Iran is noted in Cisco’s Export and Contract Compliance page as one of several countries where certain Cisco Solutions products may not be delivered. (Company Website)

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Cisco’s Corporate Social Responsibility policy states, “Our corporate social responsibility (CSR) programs are designed to provide long-term benefits to our employees, customers, shareholders, partners, and individuals in communities around the world. We focus on three main areas: Employees, Environment, and Social Investments” (Company Website).

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In its Code of Business Conduct, Cisco claims to be a “good corporate citizen” and states that, “As a global company, we stay on top of laws and regulations as they apply to doing business around the world” (Cisco Code of Business Conduct).