SEC vs. Globalization

The Securities and Exchange Commission is jumping all over Intel Corporation because a press report said that computers in Cuba have Celeron processors in them. Coverage from The Wall Street Journal here and from CNET here. Intel’s response and the SEC’s complaint are here; the gist of Intel’s response is in this paragraph:

"A May 2, 2008 Associated Press article about the availability of PCs in Cuba said: 'The Cuban PCs have Intel Celeron processors with 80 gigabytes of memory and 512 RAM and are equipped with Microsoft’s Windows XP operating system. Both could be violations of a U.S. trade embargo, but not something Washington can do anything about in the absence of diplomatic relations with Havana. Clerks said the PCs were assembled by Cuban companies using parts imported from China.' As noted above, Intel policy in accord with the Export Regulations prohibits the sale of Intel products to Cuba. We have not received any information concerning the parts referred to in the news article beyond the reference in the news article. We do not know if an Intel customer in China, or a party who purchased processors from an Intel customer in China, shipped the parts to Cuba, nor if the article is accurate with regard to the reference to China. Each year we sell millions of microprocessors to approximately 13,000 customers in China. The article also noted that the U.S. government could not take action on the matter since there are no diplomatic relations between the U.S. and Cuba. Similarly, due to the travel and other constraints imposed by the embargo, it was not feasible for Intel to investigate this matter in Cuba."