Seagate violated sanctions by selling hard drives to Huawei, says Senate committee

A major U.S. data-storage equipment provider violated U.S. export rules by continuing to sell hard-disk drives to Huawei Technologies Co. after the Commerce Department tightened export restrictions last year, a report by a group of Senate Republicans claimed.

The report released by the Republican minority staff of the Senate Committee on Commerce, Science, and Transportation claimed that Seagate ignored August 2020 restrictions on shipping semiconductor components to Huawei — a category the report alleges “likely includes hard disk drives.”

The report advises the US Commerce Department to “prioritize” enforcement of the sanctions, which the Trump administration implemented after claiming Huawei posed a national security threat requests, as well as urging Seagate to stop shipments to Huawei and.

It also urged a halt to unlicensed shipments of technology to Huawei and called on the Commerce Department to better enforce restrictions on Huawei and “penalize past shipments in violation of this regulation.”

The Chinese titan has used Seagate, Western Digital, and Toshiba hard drives for its growing external storage business. The report also says that sanctions led Western Digital and Toshiba to cease their shipments, after banning companies that operate in the US from selling some products to Huawei without a license

However, the company previously issued a statement in 2020 saying that it didn’t need such a license for its hard drives. It also concedes that the chip shortage may have raised stock prices across the board, however,” it added.

In addition, Seagate benefitted from an uneven playing field to the detriment of national security by shipping these prohibited products to Huawei, as well as doing it at the expense of its competitors who abide by the rule designed to combat threats posed by companies with known connections to the Chinese government, according to the report.