Seagate Technology (STX) receives proposed charging letter from U.S. Commerce alleging violations of U.S. Export Administration Regulations
Seagate Technology (NASDAQ: STX) disclosed:
On August 29, 2022, Seagate Technology Holdings plc (“Seagate” or the “Company”) received a proposed charging letter (“PCL”) from the U.S. Commerce Department’s Bureau of Industry and Security (“BIS”), alleging violations of the U.S. Export Administration Regulations (“EAR”). The PCL alleges Seagate acted in violation of the EAR by providing Seagate hard disk drives (“HDDs”) to a customer and its affiliates listed on the BIS Entity List between August 2020 and September 2021. Seagate has responded to the PCL, setting forth Seagate’s position that it did not engage in prohibited conduct as alleged by BIS, because, among other reasons, Seagate’s HDDs are not subject to the EAR.
The matters raised by the PCL remain unresolved at this time, and there can be no assurance as to the timing or terms of any final outcome. Seagate is unable at this time to estimate the range of loss and/or penalty, if any, although it is possible that the outcome could have a material impact on our business, results of operations, financial condition, and cash flows.
Seagate believes it has complied with all relevant export control laws and regulations. Seagate has committed to compliance through its global team of international trade compliance and legal professionals and by maintaining robust trade controls compliance policies and procedures. Seagate has been cooperating with BIS and intends to continue to engage with BIS to seek a resolution of this matter.