A senior Federal Communications Commission (FCC) official said Wednesday the FCC will propose blocking China Mobile USA from the American market, citing “national security risks” as well as economic espionage concerns.
According to the official, China Mobile “is vulnerable to exploitation, influence and control by the Chinese government” and “may comply with espionage requests by the Chinese government.”
Eight years ago, China Mobile — a Delaware company indirectly owned by the People’s Republic of China — submitted an application to the FCC asking to provide international telecommunications services to U.S. customers.
The FCC referred the application — which required an authorization from the FCC under Section 214 of the 1934 Communications Act — to review by executive branch agencies.
No one acted on it until 2018, when the Trump administration’s National Telecommunications and Information Administration (NTIA) recommended the FCC not approve the application, citing national security concerns.
The FCC now concurs with the Trump administration, but will vote on the move at its May 9 Open Meeting, according to the press release.
China Mobile did submit a proposal for voluntary mitigation, but the Trump administration rejected the proposal.
The order comes as the Trump administration continues its crackdown on companies like Huawei with potential backdoors for the Chinese government.
“Safeguarding our communications networks is critical to our national security,” FCC Chairman Ajit Pai said in a statement to InsideSources. “After reviewing the evidence in this proceeding, including the input provided by other federal agencies, it is clear that China Mobile’s application to provide telecommunications services in our country raises substantial and serious national security and law enforcement risks. Therefore, I do not believe that approving it would be in the public interest. I hope that my colleagues will join me in voting to reject China Mobile’s application.”
Despite the Trump administration’s suspicion of Chinese telecom giants, the administration isn’t averse to foreign telecom companies serving U.S. customers. T-Mobile and Sprint, for example, are majority owned by German telecom company Deutsche Telekom and Japanese tech company SoftBank, respectively.
The U.S. government isn’t even opposed to foreign government-controlled telecom companies serving U.S. customers, the FCC said. The issue with China Mobile and Huawei comes down to trust.
“This assessment rests in large part on China’s record of intelligence activities and economic espionage targeting the U.S., along with China Mobile’s size and resources,” the NTIA said. “China Mobile … as a prominent state-owned enterprise, cannot be expected to act against the interest of the Chinese government on any sensitive matter.”
According to a senior FCC official, “The FCC took a fresh look at this given what the executive branch said, as well as [what] China Mobile [said], and it’s our judgment that the executive branch is correct and a mitigation agreement will not work here because there is not a sufficient level of trust that China would comply with it.”
The official also told reporters it is not concerned about Chinese retaliation with regard to this decision.
“In a situation such as this, we believe the most important priority is protecting the national security of the U.S., and we do not believe the application is in the interest of the national security of the U.S., so that’s the number one basis on which this decision has been made,” the official said.
