The Bureau of Industry and Security has imposed a $28,600 penalty against a U.S. company to resolve charges that it committed nine violations of the anti-boycott provisions of the Export Administration Regulations in connection with transactions involving the sale and/or transfer of goods or services to Bahrain. BIS alleged that, with the intent to comply with, further, or support an unsanctioned foreign boycott, the company furnished information concerning another person’s business relationships with another person known or believed to be restricted from having any business relationship with or in a boycotting country. The company was also charged with failing to report its receipt of requests to engage in a restrictive trade practice or boycott.
Under the anti-boycott provisions of the EAR, companies are prohibited from (a) refusing to do business with or in Israel or with blacklisted companies, (b) furnishing information about relationships with or in Israel or with blacklisted companies, (c) discriminating against others based on race, religion, sex, national origin, or nationality, (d) furnishing information about the race, religion, sex, or national origin of another person, and (e) implementing letters of credit containing prohibited boycott terms or conditions. The EAR also require U.S. persons to report each quarter requests they have received to take certain actions to comply with, further, or support an unsanctioned foreign boycott.
Maximum civil penalties under the EAR for anti-boycott violations are the greater of $250,000 per violation or twice the value of the transaction. For criminal violations, penalties of up to $1 million and/or 20 years’ imprisonment may be imposed.