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Robert Bosch GmbH (Bosch), the German multinational engineering and technology company, has agreed to pay a $36,184,680 penalty to the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) for exporting controlled items to Huawei Technologies Co. and its affiliates without the required U.S. government authorization.
What Happened
Between September 2020 and September 2024, Bosch exported approximately $72.4 million worth of Micro-Electro-Mechanical Systems (MEMS) sensor products and automotive software from abroad to Huawei and its affiliates. The exported items were subject to the Export Administration Regulations (EAR) under the Foreign Direct Product Rule, a rule that extends U.S. export controls to certain foreign-produced items that incorporate U.S. technology or are manufactured using U.S. equipment. Because Huawei and its affiliates are listed on BIS’s Entity List, any shipment of items subject to the EAR requires a license from BIS. No such license or authorization was obtained.
The MEMS sensors at issue are widely used in consumer products, including smartphones, wearable technology, and automobiles.
The Penalty
In addition to the $36 million BIS civil penalty, Bosch separately agreed with the Department of Justice to disgorge profits from the transactions, with an actual payment of approximately $3.6 million. BIS suspended approximately $3.6 million of its penalty as credit for the disgorgement, bringing Bosch’s total financial exposure to roughly $39.8 million.
Bosch filed a Voluntary Self-Disclosure with BIS and cooperated with the investigation.
What This Means for Exporters
BIS Assistant Secretary for Export Enforcement David Peters was direct in his message to the broader trade community: Bosch had multiple opportunities to identify and avoid these violations had it exercised the level of vigilance BIS expects of companies whose transactions are governed by the EAR. The enforcement action is intended to serve as a warning to companies that fall short of that standard.
This action is a reminder that export compliance obligations extend to the entire supply chain, including foreign subsidiaries and overseas manufacturing operations.
Companies that export items subject to the EAR, or that produce foreign goods using U.S. technology or equipment, should conduct a thorough review of their compliance programs to ensure they are meeting BIS’s expectations before an enforcement action forces the issue.
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