DEPARTMENT OF STATE AND ALPINE AEROSPACE CO. REACH AGREEMENT ON ARMS EXPORT VIOLATIONS

FROM U.S. STATE DEPARTMENT

The Department of State has reached administrative agreement with Alpine Aerospace Corporation and TS Trade Tech Incorporated of New Jersey to resolve violations of the Arms Export Control Act (AECA) and the International Traffic in Arms Regulations (ITAR) related to the export of significant military equipment.

The two companies, which share common ownership, procure and sell replacement parts to the aerospace industry. Many of the parts procured and sold by the Companies are designated as defense articles pursuant to § 38 of the AECA and the United States Munitions List (USML), § 121.1 of the ITAR and require authorization from the Department prior to export. Following an October 2010 filing of criminal information in the District Court for the District of New Jersey, the companies approached the Department to propose an administrative settlement and disclose additional violations.

From July 2005 through January 2007, the two companies arranged several foreign sales without obtaining the proper approvals prior to exporting, and in some instances, cited licenses that did not cover the companies' exports. In addition, the companies failed to obtain the appropriate non-transfer and use certifications for export of significant military equipment.

The Department proposed the following charges, which are resolved by the concluded agreements along with additional violations disclosed to the Department. Alpine engaged in six exports of parts for use on a Hawk missile system, and in a separate violation, failed to obtain a DSP-83 Non-Transfer and Use Certificate for these exports. Alpine cited an existing export license on export control documents for the exports which did not, in fact, authorize the export of parts for the Hawk missile system. TS Trade engaged in one export of aircraft parts and associated equipment without authorization.

Under the terms of the agreements, Alpine agrees to a civil penalty of $30,000 and TS Trade Tech agrees to a civil penalty of $20,000. The civil penalties are to be suspended on the condition that they are to be used for pre- and post-Consent Agreement expenditures for remedial compliance measures. Any portion of the penalty that is not so used will be forfeited at the conclusion of the thirty-month term of the agreements. The companies will implement additional remedial compliance measures, provide additional training to staff and principals, and will undergo two external audits of their compliance programs.

The companies have acknowledged the seriousness of the ITAR violations and have cooperated with the Department, expressed regret for their actions and taken steps to improve their compliance with law and regulations. For these reasons, the Department has determined that an administrative debarment of the companies is not appropriate at this time.