On February 12, 2026, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) has announced that Applied Materials, Inc. and its South Korean affiliate, Applied Materials Korea, Ltd., will pay a civil penalty of approximately $252 million to settle allegations that they exported U.S.-origin semiconductor manufacturing equipment to China without the required export licenses. This penalty is the second-largest ever imposed by BIS in an export control enforcement case.
According to BIS, the violations occurred in 2021 and 2022 when the companies shipped ion implanter systems – specialized tools used in semiconductor fabrication; from the United States to their South Korean facility for assembly, and then onward to Semiconductor Manufacturing International Corp. (SMIC) and its subsidiaries in China. SMIC was placed on the U.S. Entity List in 2020 due to national security concerns, meaning that exports to the company require a license from BIS.
The value of the equipment involved in the alleged violations was roughly $126 million. The $252 million penalty, twice the transaction value – represents the maximum civil fine permitted under U.S. export control law. As part of the settlement, Applied Materials has agreed to conduct internal audits of its export compliance program and provide annual certifications to BIS.
The BIS enforcement action underscores the rigorous application of U.S. export control regulations on sensitive technology, particularly in the semiconductor sector, where restrictions have increased amid broader national security and supply chain concerns. The company said related investigations by the U.S. Department of Justice and Securities and Exchange Commission have been closed without further action.
Official media release from Bureau of Industry and Security: