Rail Supplier Fined for Anti-Boycott Violations

Commerce’s Bureau of Industry and Security (BIS) imposed a civil penalty of $153,175 against Wabtec Corporation, a global manufacturer and supplier of rail technology headquartered in Pittsburgh, Pennsylvania, to resolve 43 violations of the antiboycott provisions of the Export Administration Regulations (EAR) (antiboycott regulations) alleged in BIS’s Proposed Charging Letter.

Wabtec voluntarily disclosed the conduct to BIS, cooperated with the investigation by BIS’s Office of Antiboycott Compliance (OAC), and took remedial measures after discovering the conduct at issue, which resulted in a significant reduction in the penalty.

“This settlement involves failures to report Pakistan-origin boycott-related requests, underscoring the need for companies to be vigilant for boycott-related language regardless of the country of origin,” said Assistant Secretary for Export Enforcement Matthew S. Axelrod. “It’s not enough just to decline boycott-related requests – our rules require companies to come tell us that certain requests were made.” 

Formerly the Westinghouse Air Brake Company, Wabtec is a leading supplier of rail locomotion, switching and control equipment.  Wabtec subsidiary GE Transportation is the largest producer of diesel-electric locomotives North America, believed to hold up to a 70% market share of that market.

BIS Case Background:

As part of the BIS settlement, Wabtec admitted to the conduct set forth in a Proposed Charging Letter, which alleged 43 violations of Section 760.5 of the EAR (Failing to Report the Receipt of a Request to Engage in a Restrictive Trade Practice or Foreign Boycott Against a Country Friendly to the United States).

Specifically, between February 2018 and July 2022, on forty-three occasions, Wabtec received a request from a customer in Pakistan to refrain from importing Israeli-origin goods into Pakistan in fulfillment of its orders.

Wabtec failed to report to BIS the receipt of these requests, as required by Section 760.5 of the EAR, thereby giving rise to the 43 alleged violations.

The Order, Settlement Agreement, and Proposed Charging Letter are available here.