UTC agrees fine over China military exports One of the US's largest defence contractors, United Technologies, has pleaded guilty to knowingly supplying technology for China's first modern military attack helicopters, in a serious breach of US controls on arms export to the country. Pratt & Whitney Canada, a UTC subsidiary, and Hamilton Sundstrand, a US subsidiary, agreed at the court hearing in Bridgeport, Connecticut, to pay up to $75m in fines for the offences, which the Department of Justice said began as early as 2000. The case highlights the still-important role of the US and other western countries as sources of the most sophisticated technologies for rising military powers such as China - and the sensitivity of exports of potentially dual-use technologies. Lisa Monaco, the US assistant attorney-general for national security, said the companies" efforts had helped China to develop its Z-10 helicopter, designed to attack tanks and operate over battlefields. "As today's case demonstrates, the justice department will spare no effort to hold accountable those who compromise US national security for the sake of profits and then lie about it to the government," she said. Louis Chênevert, UTC's chief executive, said the company accepted responsibility for the offences and deeply regretted they had occurred. "As a supplier of controlled products and technologies to the Department of Defense ... we are committed to conducting business in full compliance with all export laws and regulations," he said. Pratt & Whitney Canada supplied electronic engine control software used in the Z-10 and then failed to disclose this properly to the US government. The Chinese authorities had told UTC they were developing a civilian helicopter at the same time as the Z-10, but the DoJ said that some of the UTC subsidiary's staff suspected the links between the two all along. The company agreed to supply the software, expecting it would gain a position in the growing Chinese civilian helicopter market, which it expected to earn it $2bn in annual revenue. The software had been modified for purely military purposes, however, and therefore needed a licence for military exports, which Pratt & Whitney Canada did not seek. John Morton, director of the DoJ's immigration and customs enforcement division, said the case was a "clear example" of how the illegal export of sensitive material reduced the US's military advantages. "I am hopeful that the conviction of Pratt & Whitney Canada and the substantial penalty levied ... will deter other companies from considering similarly ill-conceived business practices in the future," he said. Up to $20m of the fines could be suspended if UTC introduces satisfactory controls on sensitive exports. The companies agreed as part of a deal to avoid prosecution on two further counts to allow an independent monitor to oversee their compliance with export regulations for the next two years. The US Congress imposed controls on exports of certain sensitive military technology, specifically including helicopters, following China's brutal crackdown on pro-democracy protests in 1989. Ed Bradley, the agent in charge of the northeast field office of the US Defence Criminal Investigative Service, said the agency knew foreign governments were seeking US military technology. "Thwarting these efforts is a top priority for DCIS," he said. UTC's shares fell 2.1 per cent to $72.60 in New York.