Viet Procurement Office Faces Debarment for ITAR Violations

Posted

The Vietnamese government-owned company VTA Telecom Corporation (VTA) has been administratively debarred for violating the International Traffic in Arms Regulations (ITAR), according to a public notice issued by the Department of State. 

VTA Telecom Corporation was found to have exported or attempted to export ITAR-controlled defense articles, including hobby rocket motors, video trackers, and a gas turbine engine, without proper authorization. These items are listed under U.S. Munitions List Categories IV(d)(7), IV(h), IV(h)(11), XII(a), and XIX(c). Notably, the exports were made to Vietnam, a country prohibited under ITAR regulations at the time of the violations.

Furthermore, VTA violated the ITAR by knowingly providing false statements on the required end-use statements, with the intention of facilitating the export of defense articles to Vietnam.

In response to these violations, VTA Telecom Corporation entered into a Consent Agreement with the Department of State on April 20, 2023, which settled the ITAR violations. As part of the agreement, the Assistant Secretary for Political-Military Affairs administratively debarred the company until April 20, 2026.

The investigation into VTA Telecom began in 2016 and uncovered attempts by the company to procure and illegally export missile engines and guidance equipment. Huy Quang Bui, an executive of VTA Telecom's parent company Viettel, pleaded guilty to the charges and served a short sentence in federal prison before being deported to Vietnam.

Viettel, officially known as Tập đoàn Công nghiệp Viễn thông Quân đội, translates to "Military Telecommunications Industry Group" and is wholly owned and operated by Vietnam's Ministry of Defense.   Besides its well known civilian telecommunications sector, Viettel is becoming a major defence contractor of Vietnam with subsidiaries developing, producing and supplying the Vietnam People's Army with many indigenous products and armaments such as military communication devices, military drones, surveillance radars, and missiles

In June 2015, Bui approached a Florida company with the intention of purchasing 10 video tracking systems, which were classified as "significant military equipment" under the ITAR. These systems are subject to strict export controls. The U.S. government believes that these trackers were ultimately exported without the necessary licenses.

Bui was indicted on October 25, 2016, in the New Mexico District Court on two counts of attempting to export defense equipment from the U.S. without the required licenses.

In October 2021, VTA Telecom Corporation reached an administrative settlement with the Bureau of Industry & Security (BIS) under the U.S. Department of Commerce. The settlement included a civil penalty of $1,869,372. The investigation by BIS's Office of Export Enforcement revealed significant violations of the Export Administration Regulations (EAR). As part of the settlement, VTA agreed to pay the stated penalty, with $200,000 of the amount suspended for two years, subject to specific compliance obligations.