What did Seagate do to be fined so heavily?
The BIS said that it had imposed restrictions certain foreign-produced items related to Huawei. However, in September 2020, Seagate announced it would continue to do business with Huawei. “Seagate did so despite the fact that its only two competitors had stopped selling HDDs to Huawei, resulting in Seagate becoming Huawei’s sole source provider of HDDs,” said BIS in the statement.
Furthermore, the BIS has accused Seagate of signing a three-year agreement with Huawei to become“Huawei’s strategic supplier” and granting the company “priority basis over other Huawei suppliers.”
- Seagate sold or exported close to 7.4 million hard drives to Huawei, despite US imposing restrictions.
“Those who would violate our FDP rule restrictions are now on notice that these cases will be investigated and charged, as appropriate,” said Director of the Office of Export Enforcement John Sonderman. “Any company exporting to an entity subject to the additional FDP rule restrictions needs to evaluate its entire manufacturing process to determine if specified US technologies or software were used in building the essential tools used in production. Companies that discover violations should submit voluntary self-disclosures to OEE.”
The fine imposed on Seagate is the heaviest administrative penalty ever by BIS.