A Michigan company has been ordered by the Bureau of Industry and Security (BIS) to pay $575,000 in penalties for improperly classifying items subject to Export Classification Control Number (ECCN) 9B106.a. The items are allegedly controlled for missile technology (MT) reasons and were exported on 20 occasions over three years to the People’s Republic of China (PRC).
BIS, however, also agreed to waive $400,000 of the total penalties provided that the company pass a two-year probationary period and the company can later establish that during the probationary period they had “committed no violation of the Act, or any regulation, order, license or authorization issued thereunder and has made full and timely payment of $175,000 as set forth above.”
The company was also ordered to complete two audits of its export controls compliance program with at least one audit being conducted by an “unaffiliated third party consultant with expertise in U.S. export control laws.” The company agreed to make available copies of air waybills and other export control documents to the BIS in the event the audits identify “any actual or potential violations of the Regulations.”
Additionally, any failure to make full and timely payment of the $175,000 in civil penalties or failure to complete the audit as ordered could result in the subsequent denial of the company’s export privileges for one year.
You can read the settlement agreement here.