The bill will now go to the U.S. House of Representatives for conference negotiations.
Under the Trump deal, ZTE would have to pay another $1 billion in fines for its sanctions violations in exchange for the United States dropping an earlier ban on its purchases of equipment from USA suppliers, which the company contended would put it out of business. Instead of disciplining all employees involved, ZTE had paid some of them full bonuses and then lied about it, Commerce said.
In Hong Kong, ZTE shares tumbled 24% to HK$10.02 (US$1.28) in early trading, sinking to its lowest level in almost two years, while in Shenzhen the stock plunged by the daily limit of 10%. The company quickly announced that it was halting operations.
The company has been on life support since Washington said it had banned United States companies from selling crucial hardware and software components to ZTE for seven years.
Trump's intervention to help the firm was seen at the time as part of a move to smooth over trade tensions with Beijing as they embarked on talks to avert a trade war, with the president tweeting on May 13 that too many Chinese jobs were at threat.
Republicans and Democrats expressed national security concerns about ZTE after it broke an agreement to discipline executives who had admitted to a conspiracy to evade US sanctions by selling sensitive equipment to Iran and North Korea.
Completing the payment and the escrow placement are crucial for the embattled ZTE to resume production and be freed from a seven-year ban.
"President Trump was flat-out wrong when he chose to go easy on ZTE and allow it to start selling its technology in the United States", said Senate Democratic leader Chuck Schumer of NY.
At Trump's urging, ZTE and the U.S. Commerce Department had reached an agreement on June 7 to have the supplier ban, which has prevented ZTE from buying the U.S. components it relies on to make smartphones and other devices, lifted. He has scheduled a meeting with Republican lawmakers at the Capitol on Wednesday where Senate aides said he would discuss the issue. Cornyn and other GOP senators, including Lindsey Graham of SC, are expected to attend.
But before it can become law, the bill must be reconciled with one already passed by the House that does not include the amendment.
Sen. Dianne Feinstein, D-Calif., blasted the Senate bill, saying Congress should not cede its authority over nuclear weapons to Trump and future presidents. Also, enhanced employment opportunities for military spouses was laid out with the Military Spouse Employment Act of 2018 included in the bill.