Busy Week for BIS Export Enforcement
This week, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) announced several settlements of cases involving violation of U.S. export control laws.
In the most significant case, Sun Microsystems, Inc. and two of its subsidiaries reached a settlement involving illegal exports of computers to military end-users in China and Egypt, and for failing to comply with license conditions on eight BIS export licenses. A fourth company, Automated Systems Ltd. (ASL) of Hong Kong, involved in an export of Sun servers to the Chinese military will pay a $22,000 civil penalty to settle allegations that it aided and abetted the export. Under the agreement reached with BIS, Sun Microsystems will pay a $269,000 fine and have its export privileges denied for one year, although the denial will be suspended. To settle charges that they aided and abetted the illegal export to China, Sun Microsystems China Ltd., and Sun Microsystems California, Ltd., both of Hong Kong, will each pay a $11,000 fine and will not participate in transactions subject to the Export Administration Regulations involving the Changsha Institute of Science and Technology in the People's Republic of China, the Chinese military end-user, for one year.
BIS also imposed a $35,000 civil penalty on TLC Precision Wafer Technology of Minneapolis, Minnesota to settle charges that the company illegally exported aluminum gallium arsenide/gallium arsenide epitaxial wafers to Israel and Brazil without the required export licenses and failed to file the necessary Shippers Export Declarations (SEDs) for the transactions. These products are used in automotive, communication and radar systems. The company also provided false information on the SED for a shipment of oscillator chips to Israel.
Finally, BIS reached a settlement agreement with ABO (USA) Inc. of Miami, Florida that found that ABO conspired to export and exported second generation night vision scopes to Japan without the required export license. ABO was charged with falsifying invoices and shipping documents and disassembling the night vision scopes before export to avoid detection by U.S. authorities. Under the agreement, ABO agreed to a suspended civil fine of $20,000 and the denial of export privileges for two years to all destinations other than Canada.