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FCC moves signal US will keep anti-China telco stance under Biden

(ATF) The US Federal Communications Commission said on Thursday December 10 it had started the process of revoking China Telecom’s authorization to operate in the United States, as it took further steps to crack down on China’s role in US telecommunications.

Democrats on the FCC voted in favour of the move alongside Republican-appointed commissioners – approval was 5 to 0 – highlighting that the agency is likely to retain a tough stance towards Chinese firms after the Biden administration takes control of the US government in January.

FCC Chairman Ajit Pai noted several US government agencies had recommended the revocation, citing national security concerns.

Pai said there are “significant concerns” that China Telecom would be forced to comply with the Chinese government’s requests for information, including communications intercepts, Reuters reported.

China Telecom, the largest Chinese telecommunications company, has had authorisation to provide telecom services in the US for nearly 20 years.

China Telecom Americas did not have an immediate comment, Reuters reported.

The FCC warned in April that it might shut down the US operations of three state-controlled Chinese telecommunications companies, citing national security risks, noting China Telecom Americas, plus China Unicom Americas, Pacific Networks Corp and its wholly-owned subsidiary ComNet (USA).

The US Justice Department and other federal agencies in April the FCC in April to revoke China Telecom’s ability to operate in the United States.

In May 2019, the FCC voted unanimously to deny another state-owned Chinese telecom company, China Mobile, the right to provide services in the US, citing risks that the Chinese government could use the approval to conduct espionage against the US government.

And on Thursday the Commission rejected a petition from Huawei Technologies asking the agency to reconsider its decision designating the Chinese company as a US national security threat to communications networks.

The FCC said in June it had formally designated China’s Huawei and ZTE Corp as threats, a declaration that bars US firms from tapping an $8.3 billion government fund to purchase equipment from the companies.

The FCC affirmed its ZTE designation last month.


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Jon Macaskill

Jon Macaskill has over 25 years experience covering financial markets from New York and London. He won the State Street press award for 'Best Editorial Comment' in 2016


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