US Company Discloses Potential Entity List Violation
A U.S. hardware supplier said it may have violated U.S. export controls by selling to a Chinese foundry on the Entity List. MaxLinear, which sells highly integrated radio-frequency analog and mixed-signal semiconductor products, disclosed it submitted an "initial notification" of voluntary self-disclosure to the Bureau of Industry and Security in October and its sale may have violated the Export Administration Regulations because it never obtained a license.
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The company discovered the potential violation in September, according to its most recent SEC filing. MaxLinear said it completed “certain transactions” with one of its “foundry partners” in China in which it sent “limited technology in the form of test results and failure analysis reports.” After discovering the potential illegal export, the company said it “took immediate action to help prevent recurrence,” and its “audit committee” investigated the sale along with outside counsel.
MaxLinear said its voluntary disclosure is “currently under review” by BIS. It also said it submitted an export license application along with its disclosure “to assure that all prospective transactions with our Specific Foundry Partner are conducted in full compliance with the EAR.” The company said it has “taken and [we] continue to take remedial measures,” including “reviewing our export compliance procedures and program to determine if any modifications or amendments are required, to help prevent similar situations from occurring in the future.” Under BIS policy, the agency doesn't comment on potential investigations.