On April 19, 2023, the Bureau of Industry and Security (BIS) issued a release stating BIS imposed a $300 million penalty against Seagate related to shipments to Huawei. The release reported the civil penalty is to “resolve alleged violations of U.S. export controls related to selling hard disk drives (HDDs) to Huawei Technologies Co. Ltd. (Huawei) in violation of the foreign direct product (FDP) rule. This historic foreign direct product enforcement case and settlement represents the largest standalone administrative penalty in BIS history. Today’s resolution also includes a multi-year audit requirement and a five-year suspended Denial Order.”
On this news, Seagate’s stock price fell $2.44, or 3.88%, in intraday trading on April 20, 2023.