BAE Systems to pay $36m penalty for 104 US arms export violations

BAE Systems will pay a $36 million civil penalty after the US State Department found 104 violations of arms export rules by the company’s American arm. The administrative settlement was announced on August 13, 2026.

The breaches involved unauthorized exports of technical data to countries including China, Canada, the UK, Germany, Italy, France, Indonesia, and Switzerland. Violations ranged from sending printed wiring board data for GPS systems to a Chinese manufacturer in December 2023, to exporting a military gas-turbine engine control system to Switzerland without authorization.

The State Department said the settlement highlights the importance of exporting defense articles only with proper authorization. BAE voluntarily disclosed all but one of the alleged violations, which helped reduce the penalty, and the department suspended $18 million of the fine on condition it be used to strengthen the company’s compliance program.

Specific incidents include sending technical data related to printed wiring boards for military GPS to Canada in September 2021 after a license expired, and sending the technical specification of an explosive mixture to the UK. A BAE subcontractor also furnished defense services without authorization on more than 17 occasions in Italy, France, and Indonesia.

BAE Systems said it remains committed to full compliance with export control laws and has cooperated thoroughly with the State Department’s review. The company added that it has been working diligently to improve its compliance program over the last several years and takes seriously its responsibility to protect critical information.

The State Department noted that BAE’s supply chain team did not fully understand export control regulations, and its secure file transfer networks did not highlight export control warnings before data was sent. The settlement requires BAE to use the suspended $18 million to further strengthen its compliance measures.