Consent Agreement Export

The L3Harris Approval Agreement demonstrates the importance of a strong compliance program to prevent export violations and act as a mitigating factor in cases where an unintentional error occurs despite the existence of a well-maintained compliance program. As the L3Harris agreement makes clear, VODs alone cannot necessarily mitigate alleged offences in all circumstances. Businesses must take the necessary steps to comply with applicable rules and be conscientiously competent to report errors or errors. Otherwise, approval agreements can serve as a costly and public reminder of a company`s compliance errors. In addition, between 2013 and 2015, Airbus hired a trading partner in China, knowingly and deliberately conspiring to pay payments to its trading partner, which was to be used as bribes to government officials in China. These payments were related to the authorization of certain agreements in China regarding the purchase and sale of Airbus aircraft to state-owned and state-controlled companies in China. In order to conceal the payments and conceal the counterparty`s commitment in China, Airbus did not pay its counterparty directly, but made payments to a bank account in Hong Kong on behalf of a company controlled by another counterparty. Another important indication of the L3Harris approval agreement is the fact that DDTC`s investigation comes from a board of a DoD agency, DTSA. Companies should be aware that regulators within different executive departments can and will be able to communicate with each other in order to pursue the objectives of joint export controls. When DTSA contacts DDTC, DDTC may also contact the Department of Commerce`s Office of Industry and Security (“BIS”) on matters within the agency`s jurisdiction. On January 29, 2020, Airbus SE of the Netherlands became a new cog in the export wheel. Airbus accepted a $10 million comparison with DDTC for 75 violations of the Arms Export Control Act (AECA) and Part 130 of ITAR for the period 2011-2019.

While L3Harris described many of its alleged self-reporting offences (“VODs”) that were presented to the DDTC, the government did not find each VOD as a mitigating factor. DDTC began its investigation by providing L3Harris with information on potential export control problems by the Defense Technology Security Administration (DTSA) – a Department of Defense (DoD) agency that sets technology security guidelines for the international transfer of defense goods, services and technologies. The L3Harris agreement serves as a reminder to companies involved in the production or export of defence-related products that their export compliance programs should be holistic and cover all potential rules relating to the trade of the relevant agencies, including, but not limited to, DoD, DDTC, BIS, the Department of the Office of Foreign Assets , which manages U.S. sanctions rules, and the U.S. S.Sn These Offices. which manages U.S. foreign trade rules. On September 19, 2019, the U.S. Commercial Defence Controls Directorate (DDTC) entered into an approval agreement with L3Harris Technologies, Inc. (“L3Harris”) for alleged violations of the Arms Export Control Act (“AECA”) and the International in Traffic Arms Regulations (“ITAR”). L3Harris, an aerospace and defence technology company, allegedly committed offences involving the unauthorized export of defence articles and technical data, as well as failure to provide accurate and complete reports and licensing violations.

[1] The L3Harris agreement with DDTC offers five valuable takeaways for all defence exporters: (3) illegal re-exports of defence items from Spain to Australia; Among the penalties for its 131 alleged violations, L3Harris faces a civil fine of $13 million, of which $6.5 million may be suspended if the company puts the money into corrective compliance fees in accordance with the agreement.