The Justice Department announced today that it has declined the prosecution of Robert Bosch GmbH (Bosch), thereby resolving its investigation into an alleged scheme to send products and software manufactured with equipment that was the direct product of U.S. software or technology to an Entity-listed company in the People’s Republic of China (PRC). This decision was reached pursuant to Part I of the Department-wide Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP), after also considering the factors set forth in the Department’s Principles of Federal Prosecution of Business Organizations. Bosch promptly disclosed the misconduct to the National Security Division (NSD), fully cooperated.
Key details of the case
Timely and appropriately remediated — which qualified them for a declination under the CEP, given that aggravating circumstances were absent Bosch has agreed to disgorge the $11,430,098 in profits it made as a result of the transactions at issue — a portion of which will be credited towards the $36,184,680 fine paid in a parallel civil action by the Department of Commerce. As announced by NSD on March 30, enforcing export control and sanctions laws is a top priority and furthers NSD’s mission to protect and defend the United States against the full range of national security threats. Moreover, the Justice Manual (JM) assigns violations of the U.S. government’s primary export control and sanctions regimes, among other criminal laws affecting, involving or relating to the national security, to NSD.
Moreover, this is the first time that NSD has declined the prosecution of a company under the CEP. . “This declination reflects the clear benefits for companies that promptly disclose potential violations and fully assist in our investigations,” said Assistant Attorney General for National Security John A. “Bosch’s cooperation and timely remediation met the high standards set by the Corporate Enforcement Policy, supporting a fair and efficient resolution.
Meanwhile, this first-of-its-kind decision by NSD highlights the important role of transparency in safeguarding U.S. technology and national security.”. “This settlement agreement underscores BIS’s commitment to strong enforcement as well as incentivizing voluntary disclosures of past violations,” said Assistant Secretary of Commerce for Export Enforcement David Peters. Between September 2020 to September 2024, Bosch, through two of its non-U.S. based subsidiaries, exported over $70 million worth of foreign-produced Micro-Electro-Mechanical Systems sensor products and foreign-produced software to Huawei Technologies Co., Ltd. and its affiliates on the Entity List, including Huawei Tech.
Enforcement actions and official statements
In addition, hong Kong (collectively, Huawei) without the required license or authorization from the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) in violation of the Export Administration Regulations (EAR), 15 C.F.R. The two implicated subsidiaries are Bosch Sensortec GmbH (BST) and ETAS GmbH (ETAS).
In particular, BST and ETAS provided to Huawei foreign-produced items that were subject to the EAR pursuant to the Entity List Foreign Direct Product Rule (FDPR) for entities designated with “Footnote 1.” The investigation further revealed that Bosch’s trade compliance personnel were ill-equipped to provide accurate guidance on the FDPR. Led to several years of FDPR violations. In addition, the investigation identified ongoing sales in violation of the FDPR despite several missed opportunities where third-party companies identified potential applications of the FDPR to their products or equipment used in the provision of their services. For complete details, refer to the official DOJ press release.
Consequently, as a result, Bosch made approximately $11,430,098 in pre-tax profits. . Bosch voluntarily self-disclosed the misconduct to NSD. Bosch cooperated with NSD’s investigation, including by preserving and proactively disclosing relevant facts, information.
Documents about the conduct and promptly responding to NSD’s subsequent requests. Bosch also timely and appropriately remediated the misconduct by making organizational changes, imposing disciplinary action, adding employees to its trade compliance organization, expanding its U.S. trade compliance resources. Updating its internal policies and procedures. For related coverage, see Texas man sentenced to prison in violent US-Mexico border monopoly scheme targeting transmigrante trade.
Given all of the above and the lack of aggravating circumstances, the Department is declining to prosecute Bosch. Bosch has agreed to a disgorgement of the $11,430,098 in profits.
For related developments, read W international companies agree to pay $10.5m to settle false claims act allegations for overcharging the air force and the navy for weld tables — DOJ.