FCC Revokes China Telecom Licence In US

The Federal Communications Commission (FCC) has officially revoked and terminated the license for China Telecom (Americas) Corp.

The move should come as no surprise, as since April 2020 US federal agencies have been urging the FCC to revoke the ability of China Telecom to operate in America.

China Telecom had the authorisation to operate in the US for nearly 20 years, but the revoking of its US license comes after the FCC in 2020 also revoked the US license of China Mobile, removing its ability to operate in the US market.

China Telecom licence

The FCC announced its decision to “revoke and terminate” the licence in a statement on Tuesday.

“The Federal Communications Commission adopted an order ending China Telecom (Americas) Corporation’s ability to provide domestic interstate and international telecommunications services within the United States,” it said.

The FCC order has directed China Telecom Americas to discontinue any domestic or international services that it provides…within sixty days following the release of the order.

The FCC made clear the move was down to national security, and said it had found that China Telecom Americas had failed to rebut the serious concerns of the Executive Branch about its continued presence in the United States.

It added that since December 2020 it had given the firm, as well as Executive Branch agencies, and the general public, a process to present any remaining arguments or evidence in the matter.

“Today, based on the totality of the extensive unclassified record alone, the Commission’s public interest analysis finds that the present and future public interest, convenience, and necessity is no longer served by China Telecom Americas’ retention of its section 214 authority,” said the FCC.

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“First, today’s Order finds that China Telecom Americas, a US subsidiary of a Chinese state-owned enterprise, is subject to exploitation, influence, and control by the Chinese government and is highly likely to be forced to comply with Chinese government requests without sufficient legal procedures subject to independent judicial oversight,” the US regulatory stated.

“Second, given the changed national security environment with respect to China since the Commission authorised China Telecom Americas to provide telecommunications services in the United States almost two decades ago, the Order finds that China Telecom Americas’ ownership and control by the Chinese government raise significant national security and law enforcement risks by providing opportunities for China Telecom Americas, its parent entities, and the Chinese government to access, store, disrupt, and/or misroute US communications, which in turn allow them to engage in espionage and other harmful activities against the United States,” it stated.

The FCC said that thirdly China Telecom Americas’ conduct and representations to the Commission and other US government agencies “demonstrate a lack of candor, trustworthiness, and reliability that erodes the baseline level of trust that the Commission and other US government agencies require of telecommunications carriers given the critical nature of the provision of telecommunications service in the United States.”

The FCC said that it further mitigation would not address these significant national security and law enforcement concerns; it also found that China Telecom Americas “willfully violated two of the five provisions of the 2007 Letter of Assurances with the Executive Branch agencies, compliance with which is an express condition of its international section 214 authorisations.”

Finally, the FCC said that although it is not necessary to support these findings and conclusions, the Order finds that the “classified evidence submitted by the Executive Branch agencies further supports the decisions to revoke the domestic authority and revoke and terminate the international authorisations issued to China Telecom Americas, and the determination that further mitigation will not address the substantial national security and law enforcement risks.”

Earlier this month CrowdStrike warned that China-linked hackers called LightBasin (also known as UNC1945) has been consistently targeting the telecommunications sector at a global scale since at least 2016.

It said the group has been burrowing into mobile telephone networks around the world and using specialised tools to grab calling records and text messages from telecommunication carriers.

National security

The west has thus continued to clamp down on Chinese-linked firms.

In March this year the FCC also began efforts to revoke US operating licences for three Chinese firms, namely China Unicom Americas, as well as Pacific Networks and its wholly-owned subsidiary ComNet.

The American communications regulator made clear that its national security concerns about the three entities had not been addressed.

It comes after the former head of the FCC Ajit Pai in January warned of the ongoing threat posed by China to US telecoms networks.

Those moves were a blow to Chinese officials, who had hoped that relations with the United States that had been strained under the Presidency of Donald Trump, would improve under President Joe Biden.

Chinese firms such as Huawei and ZTE have already been blacklisted in the US (although ZTE has since been allowed to do some business in the US).

Other Chinese firms designated as threats to national security include Hytera Communications, Hangzhou Hikvision Digital Technology Co and Dahua Technology Co.

Cable concerns

National security concerns have also been raised about the Pacific Light Cable Network (PLCN) cable, which has been funded by Google and Facebook, as well as a Chinese investor.

The PLCN was intended to not only just connect Los Angeles and Hong Kong, but also connect the US to both Taiwan and the Philippines.

The FCC was concerned that the cables its Chinese investor allegedly had links to Chinese intelligence services. The FCC was concerned by the direct link to Hong Kong.

Google has been approved to use part of the cable, but not to Hong Kong.

Facebook recently withdrew an application to use the cable, citing ongoing concerns from the US government about direct communications links.