The United States on Tuesday fined the Chinese subsidiary of a US firm nearly $4 million for exporting coatings to a nuclear site in Pakistan.
PPG Paints Trading in Shanghai, a wholly-owned subsidiary of PPG Industries, agreed to pay $3.75 million over the exports – from which it had earned just $32,319 – the US Justice Department said.
The fines “represent one of the largest monetary penalties for export violations in the history of the US Department of Commerce’s Bureau of Industry and Security established in 1987,” it said.
The company was accused of “illegal export, re-export and/or transshipment of high-performance coatings from the United States to the Chashma 2 Nuclear Power Plant in Pakistan via a third-party distributor (in China),” it said.
In addition to the maximum criminal penalty of $2 million, the two companies agreed to pay an additional $1.75 million in civil penalties and submit to a US audit.
US Attorney for the District of Columbia Ronald Machen said in a statement that the case should “serve as a warning to corporations that would violate US export laws.”
“It is not only unlawful, it is also bad business,” he said.
The transactions took place between June 2006 and March 2007 after PPG Paints Trading unsuccessfully sought an export licence to ship the coatings to Chashma 2.
The company said at the time that the coatings were for a nuclear power plant in China, which would not require a licence. The US has heavily restricted exports to entities affiliated with Pakistan’s nuclear programme since 1998.
Published in The Express Tribune, December 23rd, 2010.
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