Washington, United States: According to the Commerce Department, US officials fined Seagate Technology $300 million on Wednesday to address claims that it had sold hard disc drives to Huawei Technologies in violation of export regulations.
Despite US restrictions, the firm participated in the delivery of hard disc drives to Huawei businesses valued at over $1.1 billion.
The Commerce Department claims that the offences occurred between August 2020 and September 2021.
The US included Huawei and a few of its affiliates on a trade blacklist in 2019 that enforced licencing requirements on goods transfers, exports, and re-exports.
The Bureau of Industry and Security (BIS) also introduced controls in 2020 over certain foreign-made items to “better address the continuing threat” by Huawei to US national security and foreign policy interests.
“Even after Huawei was placed on the Entity List for conduct inimical to our national security, and its competitors had stopped selling to them due to our foreign direct product rule, Seagate continued sending hard disk drives to Huawei,” said Assistant Secretary for Export enforcement Matthew Axelrod in a statement.
“Today’s action is the consequence: the largest stand-alone administrative resolution in our agency’s history,” he added, referring to the BIS.
Despite the controls in 2020 imposed by BIS, Seagate said it would continue doing business with Huawei, the Commerce Department noted.
“ Seagate did so despite the fact that its only two competitors had stopped selling HDDs (hard disk drives) to Huawei, resulting in Seagate becoming Huawei’s sole source provider,” the department added.
According to the bureau’s investigation, Seagate was involved in the shipment of more than 7.4 million hard disk drives without authorization.
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