Company admits violating export rules
A US-based engineering systems company has admitted applying to sell equipment to India without disclosing to the US Department of Commerce that it could be used in the nuclear industry. MTS Systems has described its actions as unacceptable and paid an $800,000 fine.
A US-based engineering systems company has admitted applying to sell equipment to India without disclosing to the US Department of Commerce that it could be used in the nuclear industry.
MTS Systems Corporation made the admission in a settlement bringing to an end a six-year investigation by the Department of Justice and the Department of Commerce. The company has agreed that when it filed applications for approval to sell seismic testing equipment to Indian entities in 2003, it failed to disclose that it knew the equipment could be used in testing the safety of nuclear power plant components. Under US law, US companies are not allowed to trade nuclear equipment or materials with India, although the two countries are in negotiations on a nuclear cooperation agreement to open the door to such trade.
In a letter to its shareholders, Laura Hamilton, MTS president and CEO, said: "MTS takes full responsibility for these violations of law. While no equipment was shipped, these actions by our employees are still unacceptable. Our Code of Conduct states that we are expected to conduct ourselves with the highest level of integrity and explicitly that we will comply with both the letter and spirit of the laws wherever we do business. In these instances we did not live up to our own expectations."
Under the terms of the settlement, MTS must pay a fine and civil penalty payment of $800,000 to the US government, as well as sponsoring a public export compliance symposium 'to help others learn from our mistakes', and taking action to ensure it has an effective export management and compliance system in place. The company paid a civil penalty payment of $36,000 in March 2006.
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