If you think you can ignore US export controls and simply ship out minor EAR99 parts (such as wire and connectors) without consequences, think again! Today (August 15th, 2024) BIS published a charging letter and settlement agreement with Middletown, Pennsylvania based TE Connectivity Corporation in which the company has been granted 30 days to fork over $5.8 Million dollars to the Bureau for 79 violations of the EAR that occurred between 2015 and 2019 which involved shipments of very minor parts (all EAR99) to military based end users, some of which were listed on the BIS Entity List and some of whom were not, however even non-Entity list consignees were subject to licenses because the parts were integrated into Unmanned Aerial Vehicles (UAV’s) and thus subject to the special Part 744.3 end user/end use based controls that trigger a licensing requirement for all items subject to the EAR if used in missile and UAV systems developed/produced by or for use in Group D:4 countries. Lessons learned are as follows: 

  1. If you fail to do your due diligence and export minor EAR99 items as No License Required (NLR) into D:4 countries with even the slightest reason to know that end use may be for missile and UAV programs you do so at your own peril.  
  1. Yes, BIS can and will go back more than 5-years and penalize you for EAR violations. And as shown in the case of TE Connectivity the penalties can indeed by quite severe.  
  1. Yes, it is worth it to spend significant money to ensure your company has an effective export compliance program. Compliance professionals and programs do not come cheap, but instead of handing over 5.8 million dollars to the US government and damaging your company’s reputation, you are best off spending that money to prioritize export compliance within your company. 

Click HERE to read more about this enforcement case.