Washington, Mar 8 (IANS): Chinese telecommunications giant ZTE Corp has pleaded guilty to violating US sanctions on Iran and obstructing justice and agreed to pay $892 million in fines, a media report said.

The settlement is expected to end a five-year probe that raised trade tensions between the US and China, the Wall Street Journal reported.

The penalties, among the largest ever in a sanctions case, were imposed on China's largest publicly traded telecom manufacturer for its orchestration of a six-year-long conspiracy to acquire US technology, send it to Iran and mask its involvement through a network of front companies, officials said.

"The highest levels of management within the company approved the scheme and the company repeatedly lied to and misled federal investigators," said Mary McCord, who runs the Justice Department's national security division, according to the report.

"ZTE acknowledges the mistakes it made, takes responsibility for them, and remains committed to positive change in the company," said ZTE Chairman and CEO Zhao Xianming in a statement detailing changes the company has made to ensure compliance with the US regulations.

The investigation into ZTE - one of the few Chinese consumer brands to break into the US market - had deeply alarmed Chinese policy makers.

Following Apple Inc, Samsung Electronics Co and LG Electronics Inc, ZTE is the fourth-largest smartphone vendor in the US based on number of units sold.

The steep penalties -- imposed by the Justice, Commerce and Treasury Departments -- will nearly wipe out the equivalent of the past two years of ZTE's net profits, the WSJ report said.

The company could be forced to pay an additional $300 million if it violates its pact with the Commerce Department, the report added.

In a Wednesday filing to the Hong Kong stock exchange, ZTE reported a net loss of $342 million in calendar year 2016 and said that, had it not been for the provisions for the US penalties, its 2016 net profit would have risen 19 per cent.

Although ZTE managed to avoid a much more devastating outcome: prolonged trade sanctions blocking companies from exporting US goods to it.

Without the ability to get key components for its smartphones such as processors from the US company Qualcomm Inc, ZTE's ability to produce some of its major products could have been crippled in a matter of months, putting it at risk of bankruptcy, the WSJ report said.