Commentary on Political Economy

Thursday, 9 April 2020

US agencies call for China Telecom’s licence to be revoked National-security concerns cited in recommendation to FCC, which will have the final say Two US senators had previously flagged concerns about China Telecom and sought a review of its authorisation 

The Trump administration on Thursday recommended that China Telecom’s authorisation to operate in the US be revoked, citing national security risks from allowing the Chinese state-owned group to continue providing international telecommunications services to the US market. The recommendation from several US agencies, including the Department of Justice, is the latest in a wide-ranging effort since Donald Trump became president to push back against China’s growing technological strength. China Telecom (Americas) was given authorisation in 2007 by the Federal Communications Commission, an independent agency that regulates US telecommunications. But following a review, the justice department, along with five other departments, said on Thursday that the authorisation should be revoked. “The security of our government and professional communications, as well as of our most private data, depends on our use of trusted partners from nations that share our values and our aspirations for humanity,” John Demers, head of the DoJ’s national security division, said in a statement. A final decision rests with the FCC, and would require a majority vote of its five commissioners. 

Last year, the FCC unanimously blocked another company, China Mobile, from operating in the US. “The FCC has been looking at this issue. We welcome the input of the executive branch agencies and will review it carefully,” an FCC spokesman said. Fears about China’s rise are largely shared by both Republicans and Democrats in Washington as Mr Trump has taken a hawkish stance on broad issues like trade as well as specific Chinese companies including Huawei. Last year, Chuck Schumer, the Democratic leader in the Senate, and Tom Cotton, a Republican senator, called for a review of China Telecom’s authorisation to operate in the US, as well as China Unicom’s clearances. The DoJ on Thursday said its recommendation to ban China Telecom was justified by, among other things, “concerns that China Telecom is vulnerable to exploitation, influence, and control by the [People’s Republic of China] government”. Recommended Cyber warfare State-backed hackers using virus to increase spying, UK and US warn It also claimed China Telecom’s operations in the US created “opportunities for [People’s Republic of China] state-actors to engage in malicious cyber activity enabling economic espionage and disruption and misrouting of US communications”. A representative for China Telecom could not be immediately reached. The Chinese embassy in Washington did not immediately respond to a request for comment. 

On Wednesday, William Barr, the US attorney-general, said in a Fox News interview that China was “a very serious threat to the United States geopolitically, economically, militarily, and a threat to the integrity of our institutions”. Earlier on Wednesday, the DoJ gave Google clearance to operate a subsea cable between the US and Taiwan, which is governed separately to mainland China. However, the DoJ banned any connection to Hong Kong, where the Chinese government has strengthened its control in recent years.

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