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$300,000 Penalty for Illegal Defense Exports to China and India

Thursday, October 31, 2013
Sandler, Travis & Rosenberg Trade Report

The Bureau of Industry and Security has issued an order assessing a $300,000 civil penalty against an Ohio company to settle charges that it committed 12 violations of the Export Administration Regulations by exporting graphite controlled for missile technology reasons to China and India without the required licenses. This order also requires the company to hire an unaffiliated third-party consultant to conduct an external audit of its export controls compliance program and those of its subsidiaries in France, Italy and South Africa. If this audit identifies actual or potential EAR violations by any of these four entities, the company will have to promptly provide copies of the pertinent air waybills and other export control documents and supporting documentation to the BIS Washington Field Office. If the penalty is not paid in a full and timely manner, or if the audit is not completed, the BIS may deny all of the company’s export privileges for one year.

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