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Laser manufacturer IPG Photonics, based in Oxford, is facing an investigation into equipment shipments, the company disclosed in its third quarter earnings report in 2021.
IPG did not disclose what types of equipment shipments were being investigated or when said shipments took place, but suggested in the report they were exports outside of the United States.
In its disclosure, the company acknowledged it has identified and may continue to identify times when it has exported products without receiving appropriate trade control authorizations in the countries it does business or, in some cases, submitting approval requests at all.
“As a result, we have submitted a limited number of voluntary self-disclosures regarding compliance with export control laws and regulations with the U.S. Department of Commerce’s Bureau of Industry and Security,” IPG said in its report.
After doing so, the DOJ informed IPG in October the department was investigating certain company shipments.
In the leadup to the investigation disclosure, IPG noted its business operations involve importing and exporting components and products among many countries, including the United States, Germany, Russia, and China, which is IPG’s largest market. Trade controls, which are subject to change from time to time, may vary from country to country and sometimes requires IPG to receive a license before it can export or re-export certain products, software, or technology, according to the report. The licensing process, IPG said, can cause delays and increase the cost of doing business, as well as limit the company’s ability to use or sell the products and technologies in question.
IPG did not say the shipments under investigation include exports to China and Russia, but did express concern about “disruption of our supplies from or to our Russian operation” and any additional trade controls that may be directed at China, noting it would negatively impact business operations.
Neither the DOJ nor IPG immediately responded to a request for comment Tuesday morning.
IPG said in its report it was fully cooperating with the DOJ’s investigation, noting that “failure to comply with these laws and regulations could result in costly government investigations, government sanctions, including substantial monetary penalties, civil or criminal penalties, denial of export privileges, debarment from government contracts, and a loss of revenues and reputational harm.”
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Worcester Business Journal presents a special commemorative edition celebrating the 300th anniversary of the city of Worcester. This landmark publication covers the city and region’s rich history of growth and innovation.
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