United Technologies Corporation (UTC)

Conglomerate, Manufacturing
63958
NYSE:UTX
USA

[email protected]

"Iran imposed sanctions on 15 American companies, saying that they were involved in human rights violations and had cooperated with Israel, the state news agency IRNA reported on Sunday, in a tit-for-tat reaction to a move by Washington...The affected companies, many of them military contractors, also included ITT Corporation, United Technologies and the specialty-vehicle maker Oshkosh Corporation. The affected companies, many of them military contractors, also included ITT Corporation, United Technologies and the specialty-vehicle maker Oshkosh Corporation." (March 26, 2017).

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According to its Annual Report filed with the SEC in 2014:

  • "As part of UTC's on-going efforts to identify and terminate transactions with the Government of Iran, we recently determined that three non-U.S. subsidiaries operating through the UTC Climate, Controls & Security segment, sold fire safety products and related installation, maintenance and inspection services to certain Iranian parties located in France, Switzerland and the United Kingdom in 2012, 2013, and 2014. Each of the Iranian parties to the transactions described below has been designated by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) as an entity owned or controlled by the Government of Iran. With respect to Bank Melli Iran, Melli Bank PLC, Bank Sepah, Bank Sepah International PLC, and IranAir, these parties have also been designated by OFAC as blocked pursuant to Executive Order No. 13382. With respect to Bank Saderat Iran, this party has also been designated by OFAC as blocked pursuant to Executive Order No. 13224. A portion of the 2012 transactions and all of the 2013 and 2014 transactions took place after the President issued Executive Order 13628 on October 9, 2012, which implemented Section 218 of the Iran Threat Reduction and Syria Human Rights Act by prohibiting any entity owned or controlled by a U.S. person and established or maintained outside the U.S. from knowingly engaging in any transaction, directly or indirectly, with the Government of Iran. Accordingly, UTC has filed appropriate disclosures with OFAC.
  • In 2012, 2013, and 2014, Chubb France SCS (Chubb France), a company organized under the laws of France, sold fire safety equipment and services to the Paris offices of Bank Sepah, Bank Saderat Iran, Bank Melli Iran, and IranAir. In 2012, Chubb France sold approximately $4,324.75 in the aggregate in fire safety equipment and services to these parties, with a net profit of $164.35. Approximately $1,175.18 of the 2012 payments were received before October 9, 2012 and were not prohibited by applicable law when received. In 2013, Chubb France sold approximately $2,402.99 in the aggregate in fire safety equipment and services to these parties, with a net profit of $91.32. In 2014, Chubb France sold approximately $22,070.81 in the aggregate in fire safety equipment and services to these parties, with a net profit of $1,378.48. Chubb France has informed each of these parties that it has terminated the relationships and will not provide further fire safety equipment or maintenance inspection services.
  • In 2012, 2013, and 2014, Chubb Fire & Security Limited (Chubb UK), a company organized under the laws of the United Kingdom, sold fire safety products and provided related maintenance inspection services to Petrochemical Commercial Company (U.K.) Limited (Petrochemical). In 2012, Chubb UK sold approximately $7,422.75 in the aggregate in fire safety equipment and services to Petrochemical, with a net profit of $442.83. Approximately $7,834.23 of the 2012 payments were received before October 9, 2012 and were not prohibited by applicable law when received. In 2013, Chubb UK sold approximately $10,078.17 in the aggregate in fire safety equipment and services to Petrochemical, with a net profit of $1,224.64. In 2014, Chubb UK sold approximately $2,243.10 in the aggregate in fire safety equipment and services to Petrochemical, with a net profit of $404.18. Chubb UK has informed Petrochemical that it has terminated the relationship and will not provide further fire safety equipment or maintenance inspection services.
  • In 2012, 2013, and 2014, Security Monitoring Centres Limited (SMC), a sister company of Chubb UK organized under the laws of the United Kingdom, provided security alarm monitoring services to the London office of Melli Bank PLC. SMC provided security alarm monitoring services to the London office of Bank Sepah International PLC in 2014. SMC provided the monitoring services to the Iranian banks pursuant to a contract between SMC and Total Security Systems Ltd. (Total Security), a third-party company organized under the laws of the United Kingdom. Total Security had contracts with the two Iranian banks to maintain and monitor their security alarm systems, and Total Security subcontracted the monitoring work to SMC. The contract between Total Security and SMC provides that Total Security will pay SMC a lump sum of $17,526 per year, in exchange for SMC providing monitoring services to 120 of Total Security’s customers. In 2012, SMC received total payments and net profit of approximately $868.90 and $230.28, respectively, for services provided to Melli Bank PLC. In 2013, SMC received total payments and net profit of approximately $857.14 and $229.69, respectively, for monitoring services provided to Melli Bank PLC. In 2014, SMC received total payment and net profit of approximately $961.74 and $381.01, respectively, for monitoring services provided to Melli Bank PLC and Bank Sepah International PLC. SMC has informed Total Security that it has terminated the monitoring services to both Iranian banks and will not provide further services.
  • In 2012 and 2013, Sicli Materiel-Incendie S.A. (Sicli Switzerland), a company organized under the laws of Switzerland, sold fire safety products and provided related maintenance inspection services to the Delegation and Permanent Representative of the Islamic Republic of Iran to the United Nations Office in Geneva, Switzerland. In 2012, Sicli Switzerland sold approximately $657.17 in the aggregate in fire safety equipment and services to the Permanent Representative of Iran, with a net profit of approximately $115.12. The 2012 payments took place before October 9, 2012 and were not prohibited by applicable law when received. In 2013, Sicli Switzerland sold approximately $159.13 in fire safety equipment and services to the Delegation of Iran, with a net profit of approximately $32.16. Sicli Switzerland has discontinued the services to the Delegation and Permanent Representative and will not provide further fire safety equipment or maintenance inspection services."

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"United Technologies Corp. disclosed in regulatory filings Friday that one of its foreign businesses worked on the security system for the Paris branch of Iran's national bank, an entity singled out under U.S. economic sanctions against the Middle East country. Delta Security Solution's business with the Bank Melli Iran's Paris branch amounted to $7,582 in 2012 and 2013, a portion of which occurred after President Barack Obama signed an executive order last October limiting U.S. companies and their foreign subsidiaries from 'engaging in any transaction, directly or indirectly, with the Government of Iran.' According to securities filings, UTC reported sales of about $3.59 million over the past two years to banks, insurance companies, oil companies and embassies controlled or owned by the Iranian government. All of the sales were through foreign subsidiaries of the Hartford-based company, which declined to comment further on the sales. Though the sales amount to a sliver of UTC's annual revenue, they underline just how difficult a task U.S. companies and their overseas affiliates have complying with the expanded sanctions against Iran. In the past two months, a group of about two dozen companies — including Costco, Toyota, Oracle, Vodafone, Sony and FedEx — have filed similar notices... Jonathan M. Epstein, a partner at Holland & Knight in Washington D.C. who practices international trade law, said that the fact that UTC has ended the contracts should help it avoid sanctions. 'The winding down of something that was previously lawful and is suddenly unlawful would be a major mitigating factor,' he said, adding that the company's actions 'may very well just result in a warning letter.' The Paris-based subsidiary that did the security work, Delta Security Solutions, is owned by UTC Climate, Controls & Security. This year and last, it 'provided remote monitoring of the Paris branch's electronic alarm system as well as related maintenance services to verify the proper functioning of the branch's intrusion detection equipment,' the filings said. When the work contracts were signed in August 2010, neither the business agreements nor the services were prohibited by law, UTC said in its filings. In addition to reporting the business to the U.S. Securities and Exchange Commission, UTC Climate, Controls & Security filed this information with the Treasury's Office of Foreign Assets Control, as it has in all of these cases. Delta Security has terminated the contracts with the bank and 'does not intend to do any further business with Bank Melli Iran,' UTC said in filings. UTC also reported in April that another subsidiary sold fire safety equipment, including fire blankets, extinguishers, stands and spare parts, to the London office of the Bimeh Iran Insurance Company, another Iranian-controlled business. In February, UTC reported that two other subsidiaries, Simtronics and Water Mist Engineering AS, sold $3.51 million in fire detection and suppression equipment to the Pars Oil & Gas Company, a firm controlled by Iran. Also that month, the company reported that a foreign affiliate of Otis conducted service and maintenance at a number of Iranian 'diplomatic premises' in France, Kuwait and Hungary. That work amounted to $74,500." (The Courant, "UTC Reporting Business With Iran Despite Sanctions," 7/26/2013)

 

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"United Technologies Corp. says two overseas affiliates earned $630,000 as the company ended business with Iran. The aerospace and building systems conglomerate based in Hartford, Conn., disclosed in its annual report Thursday that its non-U.S. affiliates generated $3.5 million in revenue 'related to the orderly winding down of legacy business related to sale of fire safety equipment' United Technologies said it stopped new business with Iran in 2009. It also said non-U.S. affiliates of its Otis subsidiary serviced, maintained and modernized elevators at Iranian diplomatic premises in France, Hungary and Kuwait last year. The Otis affiliates earned $6,000." (Washington Post, "United Technologies discloses $3.5M in revenue for 2 overseas affiliates ending Iran business," 2/7/13)

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Carrier Corporation, a wholly-owned subsidiary of United Technologies Corporation, states it does business with Iran: "Delivering innovative solutions and trusted products for our customers in: Bahrain, Iran, Iraq, Oman, Qatar, Syria, Yemen." (Company Website)

United Technologies Corporation is also the parent company of three key defense contractors for the United States Military: Sikorsky Aircraft Corporation, Pratt & Whitney and Hamilton Sundstrand.

According to the Sikorsky website, "Sikorsky helicopters are used by all five branches of the United States armed forces, along with military services and commercial operators in 40 nations. Core U.S. military production programs are based on the Sikorsky H-60 aircraft: the BLACK HAWK helicopter for the U.S. Army and SEAHAWK® helicopter for the U.S. Navy. H-60 aircraft derivative aircraft perform multiple missions with other branches of the U.S. military. The CH-53E helicopter and MH-53E helicopter heavy-lift aircraft are flown by the U.S. Navy and Marine Corps to transport personnel and equipment, and in anti-mine warfare missions. Sikorsky is currently developing the next-generation CH-53K helicopter for the U.S. Marines. Sikorsky is the prime contractor in the U.S. Army's UH-60M aircraft program, which the Pentagon authorized for full rate production on June 26, 2007. The program calls for more than 1,200 of the newest BLACK HAWK aircraft during the next 25 years. In 2002, the U.S. Navy inducted the first MH-60S aircraft, the first all-new rotary wing aircraft to enter the service in a decade. The U.S. Navy's helicopter fleet will become all-Sikorsky by 2010, with the MH-60S helicopter and the MH-60R helicopter the only air platforms used." (Company Website)

Sikorsky is the manufacturer of the long-time presidential helicopter, "Marine One." (Sikorsky, "Sikorsky Submits VH-92 Proposal for Presidential Helicopter Mission," 1/26/04)

Pratt & Whitney From the P & W website: "Today, nearly 11,000 Pratt & Whitney military engines are in service with 27 armed forces worldwide, setting new standards for performance and dependability. With the best engine technology, world-renowned manufacturing techniques and a global service organization, Pratt & Whitney is completely focused on meeting the new demands of the 21st century. Pratt & Whitney currently produces the F135 engine for the F-35 Lightning II. This proven fifth-generation engine was selected by the Department of Defense as the best engine for the F-35 and is more reliable and cost-effective than adding an unwanted alternate engine. Learn why the F135 is the best engine for the F-35 at f135engine.com. Pratt & Whitney’s other military engines include the F119 for the F-22 Raptor, the F100 family that powers the F-15 and F-16, the F117 for the C-17 Globemaster III, the J52 for the EA-6B Prowler, TF30 for the F-111, and the TF33 powering AWACS, Joint STARS, B-52, and KC-135 aircraft. In addition, Pratt & Whitney offers a global network of MRO and MAS focused on maintaining engine readiness for our customers." (Company Website)

Hamilton Sundstrand Aerospace: "Hamilton Sundstrand's Aerospace business units provide technologically advanced systems, components and services for commercial and military aircraft and vehicles." (Company Website) Energy, Space & Defense: "Hamilton Sundstrand’s Energy, Space & Defense (ESD) business unit provides highly reliable, advanced technology solutions to a broad range of government and industry customers. ESD continues to bring innovative and integrated solutions to our traditional Space, Missile, Launch Vehicle, and Undersea markets, while seeking new applications for our advanced technologies in support of Army and Joint Services land-based forces, surface Navies, Renewable Energy Production, and the Nation’s Homeland Security needs." (Company Website)