Applied Materials Pays $252M Penalty for Illegal China Exports

BIS News & Updates

Filed February 12th, 2026

Detected March 1st, 2026

Summary

The Department of Commerce's Bureau of Industry and Security (BIS) announced a settlement with Applied Materials Inc. (AMAT) and Applied Materials Korea, Ltd. (AMK) for illegally exporting semiconductor manufacturing equipment to China. AMAT and AMK will pay a penalty of approximately $252 million, the second-highest ever imposed by BIS.

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What changed

The Department of Commerce's Bureau of Industry and Security (BIS) has reached a settlement with Applied Materials Inc. (AMAT) and its Korean subsidiary, AMK, requiring them to pay a $252 million penalty for illegally exporting U.S. semiconductor manufacturing equipment to China. The violations involved shipping ion implanters to China via Korea without obtaining the necessary export licenses, specifically after the recipient company was placed on the BIS Entity List in 2020. The penalty amount is twice the value of the illegally shipped merchandise, which was approximately $126 million.

As part of the settlement, AMAT must conduct multiple audits of its export compliance program and provide annual certifications to BIS. Furthermore, the employees responsible for the illegal shipments have been terminated. This enforcement action underscores BIS's commitment to safeguarding sensitive technologies and deterring violations of export control laws, with significant financial penalties and internal compliance overhauls required for non-compliance.

What to do next

Review export compliance programs for adherence to BIS regulations, particularly concerning shipments to entities on the Entity List.
Ensure all necessary export licenses are obtained before shipping restricted semiconductor manufacturing equipment.
Conduct internal audits to verify compliance with export control laws and implement corrective actions as needed.

Penalties

$252 million penalty

Source document (simplified)

FOR IMMEDIATE RELEASE | February 12, 2026 | Media Contact: [email protected]

Applied Materials to Pay $252 Million Penalty to BIS for Illegally Exporting Semiconductor Manufacturing Equipment

Download as PDF WASHINGTON, D.C. — Today, the Department of Commerce’s Bureau of Industry and Security (BIS) announced a settlement agreement with Applied Materials Inc. of Santa Clara, California (AMAT) and Applied Materials Korea, Ltd. (AMK), covering illegal exports of U.S. semiconductor manufacturing equipment to China. AMAT and AMK agreed to pay a penalty of approximately $252 million – the second-highest penalty ever imposed by BIS.

Under Secretary of Commerce for Industry and Security Jeffrey Kessler stated: “The Bureau of Industry and Security is strongly committed to safeguarding sensitive American technologies and deterring wrongdoers. When companies export their products around the world, they must follow the law or face stiff penalties.”

In 2020, the company to which AMAT had been exporting certain semiconductor manufacturing equipment (known as ion implanters) was placed on the Entity List. In 2021 and 2022, AMAT violated BIS’s requirement to obtain a license before shipping to a company on the Entity List by shipping ion implanters first to AMK in Korea for assembly, and then onward to China, without applying for and receiving an export license. The value of merchandise illegally shipped was approximately $126 million.

Today’s penalty of $252 million – twice the transaction value – is the maximum allowed by statute. As part of the settlement, AMAT also agreed to conduct multiple audits of its export compliance program and make annual certifications to BIS in connection with those audits. In addition, the compliance employees and senior global trade and production executives responsible for the illegal shipments are no longer employed by AMAT and AMK.

The full order, settlement agreement, and Proposed Charging Letter are available online here. This case was investigated by BIS’s Office of Export Enforcement, Boston Field Office and Homeland Security Investigations. For more information, please visit https://www.bis.gov/enforcement.