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Seagate Hit with $300 Million Fine for Selling HDDs in China despite Export Ban

Seagate was found to be shipping HDDs to Huawei in China, despite export controls on the country, and will pay $300 million in penalties.

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Storage/Drive giant Seagate has been hit with a $300 million penalty in the United States for violating tech export controls by shipping hard disk drives (HDDs) to . According to a press release [PDF] by the U.S. Bureau of Industry and Security, Seagate shipped goods worth more than $1.1 billion to Huawei for about a year, despite the export ban that was introduced by the Trump administration in 2020.

Bloomberg reports Seagate sold 7.4 million hard disk drives to Huawei between August 2020 and September 2021. The company became Huawei's sole supplier of hard drives since its other hard disk suppliers, Western Digital (WD) and Toshiba, stopped their shipments due to the ban.

It seems Seagate used foreign-made drives thinking they are not under the export restrictions. It is unclear if the company did this to try to exploit a loophole or just didn't know. Either ways, authorities did not agree and said that Seagate misinterpreted the rule and evaluated only the last stage of the manufacturing process, rather than the entire one.

Seagate has now reached a resolution where it will pay instalments of $15 million every three months for the next five years.

Microsoft's Recent Settlement Over Russia Links

A similar situation befell recently. The company paid a $3 million settlement after it was found to be selling software to Russia and other sanctioned countries.

Microsoft had over 1,300 violations of U.S. sanctions and export controls between 2012 and 2019. While the violations happened before the ongoing Ukraine war, many happened during Russia's invasion of and annexing of the Crimea region in Ukraine in 2014.

The company also sold software to other sanctioned nations, such as Cuba and Iran, and made a total of $12 million in revenue.

Tip of the day: If you need to Create, Delete or Resize Partitions, Windows has everything you thanks to the built-in Disk Management-tool.

SourceBloomberg
Luke Jones
Luke Jones
Luke has been writing about all things tech for more than five years. He is following Microsoft closely to bring you the latest news about Windows, Office, Azure, Skype, HoloLens and all the rest of their products.

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