US multinational United Technologies (UTX.NYSE) pled guilty to breaking US law when two of its subsidiaries provided China with American software to test and operate military helicopters, Bloomberg reported. Subsidiaries Pratt & Whitney in Canada and Hamilton Sundstrand in the US will pay more than US$75 million to the Justice and State departments to settle the case. Up to US$20 million of the fine could be lifted if United Technologies takes “remedial compliance measures.” Pratt & Whitney provided 10 engines to China in 2001 and 2002 to develop an attack helicopter. The engines themselves did not violate US law because they were the same as those used in commercial helicopters, but the Hamilton Sundstrand software used to test the engines for military purposes did violate the export prohibition. Congress has banned US companies from exporting defense-related equipment and information to China since 1990. Shares in United Technologies dropped 2.1% to US$72.60 following the news.
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