On April 30, 2025, the National Security Division of the Ministry of Justice (“DOJ”) (“NSD”), alongside the American prosecutor’s office for the Northern California District, announced a declination of prosecuting the Space Research Association universities (“USRA”) for violations of criminal export control committed by a former employee.(1) This only marks the second version issued by NSD under its policy of applying commercial organizations (“policy”), after a voluntary disclosure.
This last decision, factually similar to the first declination of the NSD involving Milliporesigma in May 2024,(2) Underlines the potentially significant advantages available for companies that quickly assess export control or potential export offenses, fully cooperate with government surveys and implement a timely correction. It strengthens that self-divulgation remains a critical factor in NSD resolutions and offers important advice for companies that sail on matters of application of national security.
NSD application policy for commercial organizations
NSD’s policy explains that control of exports and offenses to offenses “harm our national security … and this threat to national security informs how NSD comes to an appropriate resolution with a commercial organization which violates these laws and distinguishes these cases from other types of reprehensible acts of companies.”(3)
The policy also describes the framework of resolution of the potential control of criminal exports and offenses to offenses voluntarily disclosed by companies. Absent from aggravating factors,(4) Policy creates a presumption that companies meeting requirements – (1) voluntary self -divulgation in a timely manner, (2) complete cooperation and (3) reparation in a timely and appropriate – will receive an unreventory agreement and no fine.(5) NSD retains the discretionary power to make a variation in the appropriate cases. Companies must always pay damage, confiscation and restitution applicable, and policy does not protect individuals guilty of prosecution.
The declination of the USRA
USRA, a non -profit research company, contracted with NASA to sell flight control software. Between 2017 and 2020, a USRA program administrator responsible for the reasonable diligence of export control would have knowingly facilitated export without license of aeronautical software controlled at the University of Aeronautics in Beijing and astronautics, an entity on the list of entities of the American Department of Commerce, using an intermediary to avoid detection. The employee also diverted more than $ 150,000 from sales license sales.
After a NASA survey caused an internal USRA survey, the employee initially distorted his actions and provided falsified documents to the USRA lawyer. When he was faced with contradictory evidence, he admitted his reprehensible acts. The Usra quickly revealed the case to NSD, less than three months after initiating external advice and in the days following the admission of the employee.
After the disclosure, the USRA completely cooperated with the NSD survey, in particular by providing documents from foreigners and translations, and undertook a significant correction. This included the termination of the employee, the discipline of his supervisor, the improvement of internal controls and compliance programs and compensating for the NASA and the US Treasury linked to the diverted funds. The MJ has credited USRA’s cooperation for helping materially in the pursuit of the former employee, who pleaded guilty and was sentenced to imprisonment.
The NSD refused the prosecution for many potential violations and determined that the USRA has made no illegal gain, therefore requiring any loan, confiscation or restitution.
Key considerations in NSD declies
The declinations of the USRA and the Milliporesigma highlight the common NSD factors considered in the resolutions:
- Voluntary self-divulgation in a timely manner: the two companies revealed quickly after the maintenance of a lawyer and before the conclusion of internal surveys. Policy requires disclosure “within a reasonably rapid period after becoming aware of the potential violation” and “before an imminent threat of disclosure or government investigation”.(6) As the NSD noted in its press release, which Usra did after discovering the conduct “made all the difference in the government’s decision not to prosecute it”.(7) The letter of declination also stressed that the USRA voluntarily self-divulgated less than three months after the conservation of external councils, a few days following the admission of the former employee of acts reprehensible to an external lawyer, and well before the completion of the internal investigation.(8)
- Exceptional cooperation: the NSD requires proactive cooperation, including the disclosure of all the relevant facts on misconduct and those involved. USRA cooperation has been described as “exceptional” and crucial for individual prosecution. As the NSD declared, announcing the declination of the Usra, “(a) the criminal who compromised our national security was brought to justice because his employer caught him and immediately returned it.”(9)
- Effective association: a timely and appropriate formation correction was present in both cases. This included the end of criminals, the discipline involved supervisors and the manifestly improvement of compliance programs and internal controls. The USRA has also compensated the government agencies affected by the embezzlement of the employee.
- Nature of the offense: In the two variations, the NSD has taken into account the nature and severity of the offenses, including that the question of the USRA involved limited exports of public information based on public information and that the Milliporesigma question involved limited quantities and biochemical export concentrations.
- Lack of services or business involvement: NSD considered that no company has obtained illegal program gains and that the employees responsible for driving were alone. Milliporesigma was even positioned as a victim of the driving of his employee.
Conclusion
Despite recent wider doj changes in application priorities and internal reorganizations, the declination of USRA confirms that the voluntary NSD self-divulgation policy remains very relevant. The recent resolution demonstrates tangible advantages for companies that quickly assess potential national security violations, fully cooperate (including assistance to individual prosecution) and remedy effectively. The similarity between the declinations of the USRA and the Milliporesigma underlines the importance of these factors. However, given that the two cases involved thug employees acting without profit or corporate involvement, the way to a variation for companies with more systemic problems or where the company itself benefited is less clear. Companies should continue to prioritize robust internal controls and compliance programs to detect and solve the potential problems of export control and sanctions, and to conduct internal surveys on such conduct, if necessary
End notes
(1) Letter of declination of USRA (April 30, 2025), Available at https://www.justice.gov/opa/media/1398471/dl?inline.
(2) Department of Justice, press release (May 22, 2024), Available at https://www.justice.gov/archives/opa/pr/ringleader-and-company-insider-plead-guilty-defrauding-biochemical-company-diverting.
(3) Department of Justice, national security division, Policy of application of commercial organizations,, Available at https://www.justice.gov/nsd/media/1285121/dl?inline=.
(4) Aggravating factors include “driving that involves a serious threat to national security; Exports of particularly sensitive articles or for end users who are of increased concern; repeated violations; involvement of the elderly
management; and an important profit. »» Identifier. The policy explains in more detail the credit than a company can obtain if a different criminal resolution (delayed prosecution agreement or guilt of guilt) is justified due to aggravating factors. Identifier.
(5) Identifier.
(6) Identifier.
(7) Department of Justice, press release (April 30, 2025) Available at https://www.justice.gov/opa/pr/justice-department-declines-proposution-company-selfisclosed-export-control offense.
(8) Letter of declination of USRA (April 30, 2025), Available at https://www.justice.gov/opa/media/1398471/dl?inline.
(9) Department of Justice, press release (April 30, 2025) Available at https://www.justice.gov/opa/pr/justice-department-declines-proposution-company-selfisclosed-export-control offense.
This message comes from Cleary Gottlieb Steen & Hamilton LLP. It is based on the company’s memorandum, “the DOJ national security division issues a second version under the company’s application policy”, dated May 2, 2025, and available here.
