FCC Revokes Chinese Telecom’s US Authorizations | Coie Perkins
In recent years, the Federal Communications Commission (FCC) has worked closely with the US Department of Justice (DOJ) and other executive branch national security agencies to restrict China’s influence over US telecommunications. In May 2020, we analyzed the FCC’s decision to issue unprecedented show cause orders to four government-controlled Chinese telecommunications companies (China Telecom Americas, China Unicom Americas, Pacific Networks, and ComNet), which required them to explain why their national activities and international clearances under Section 214 should not be revoked for reasons of national security. Now, in a unanimous decision, the FCC has passed an order to revoke China Unicom Americas’ Section 214 authorizations (the 2022 China Unicom Americas Order). This is the second such revocation, following the FCC’s decision to revoke China Telecom Americas’ licenses in October 2021. The revocation of the license also demonstrates that the harsh actions against Chinese telecoms apparently affiliated with the government and to the Chinese military that began under the last administration continue unabated through the Biden administration.
China Unicom Americas decision signals further action against Chinese telecoms
In its March 2021 order instituting revocation proceedings against China Unicom Americas, the FCC relied heavily on the expertise of national security agencies, which argued that China Unicom Americas was subject to exploitation, influence and control of the Chinese government. The 2022 FCC Order on China Unicom Americas confirmed these findings and noted that “the national security environment and China’s role as a threat have evolved” since China Unicom Americas initially obtained its clearances in under Section 214 in 2002. Specifically, the FCC found that China Unicom Americas operations “provide opportunities [Chinese] government-sponsored actors to engage in espionage, theft of trade secrets and other confidential business information, and to harvest, disrupt, or hijack U.S. communications. The key word here is “opportunities,” as the FCC rejected the argument that an entity must first commit wrongdoing before its licenses can be revoked – the mere ability of a foreign power to collect, disrupt or to hijack the communication is sufficient. While it is not yet clear how this principle may apply outside the context of Chinese state-controlled entities, FCC statements indicate an appetite for broader telecommunications surveillance that may pose security concerns. national security.
In a statement released with the China Unicom Americas Order 2022, FCC Chairman Jessica Rosenworcel asserted that the threat posed by Chinese common carriers is real and immediate. Chairman Rosenworcel also pointed out that China Unicom Americas’ responses to the FCC’s national security and law enforcement concerns were “incomplete, misleading, or incorrect.” Therefore, the FCC concluded that the company’s continued provision of Section 214 services no longer serves the public interest. Notably, President Rosenworcel’s remarks highlighted the other two “similar revocation proceedings” that are pending against Pacific Networks and ComNet, respectively. Due to the analogous facts underlying the four revocation proceedings, the FCC’s assessment of the continuing threat posed by Chinese state-sponsored telecommunications, and the results of the FCC’s first two revocation proceedings, it is very plausible that the revocations against Pacific Networks and ComNet are only a matter of time.
Simmering U.S.-China Tension Bolsters FCC’s Expanded National Security Role
The FCC’s recent revocation proceedings against China Telecom Americas, China Unicom Americas, Pacific Networks and ComNet are emblematic of the agency’s expanded national security role. In our previous update, we commented on the FCC’s new decision to deny China Mobile domestic and international Section 214 applications in May 2019 on national security grounds. In June 2020, the FCC officially designated two Chinese telecommunications manufacturing companies with close ties to the Chinese government as national security threats. Shortly thereafter, then-President Trump issued an executive order (which President Biden later superseded and expanded with his own executive order) banning Americans from investing in dozens of Chinese companies, including telecommunications giants Huawei, China Mobile, China Telecommunications and China United Network. Communications.
This integration of national security and telecommunications into the FCC seems here to continue as tensions between the United States and China show few signs of easing. Chairman Rosenworcel doubled down on the FCC’s commitment to national security in her closing remarks on the China Unicom Americas decision: “Last year, I established the National Security Policy Committee, a team of dedicated inter-office experts who offer a comprehensive approach to security issues. at the FCC. The work they’ve done over the past year is thoughtful and impressive, and there’s even more to come.