FCC chairman cites national security, opposes China Mobile's bid to access US market

FCC chairman cites national security, opposes China Mobile's bid to access US market
© Greg Nash

Ajit Pai, the chairman of the Federal Communications Commission (FCC), announced his opposition Wednesday to allowing state-backed Chinese telecommunications company China Mobile to enter the U.S. market.

Pai cited national security concerns in his statement, saying he believes China Mobile's application to provide telecommunications services in the U.S. "raises substantial and serious national security and law enforcement risks" and is not in the public's interest.

"I hope that my colleagues will join me in voting to reject China Mobile’s application,” he said in a statement.

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The chairman's decision on Wednesday comes months after the Trump administration last year recommended that the FCC block China Mobile's application.

The FCC will vote on China Mobile's application to enter U.S. markets next month. The rest of the commissioners will have time to review Pai's recommendation and suggest edits to it before they vote on May 9. 

Pai says he will seek to block China Mobile's application, which it submitted in 2011, to provide services for phone calls between the U.S. and other countries. 

The National Telecommunications and Information Administration said in a press release last July that China Mobile posed too many national security risks to be allowed to enter the U.S. market.

China Mobile in 2011 applied to provide services from within the United States. Seven years later, in 2018, multiple executive agencies recommended that the FCC deny China Mobile's application. 

China Mobile, with almost 900 million subscribers, is one of the largest mobile phone operators in the world. 

FCC officials during a phone call with reporters on Wednesday said the commission believes China Mobile could commit espionage against U.S. consumers. The concerns stem from China Mobile's ties to the Chinese government rather than specific activities by the company itself.

A senior FCC official said China Mobile offered a mitigation proposal but Pai decided there was not sufficient trust that the company would follow through on its promises.

After reviewing the evidence, FCC officials said, they determined they were concerned that China Mobile sought to enter the U.S. market to further the Chinese government's ability to conduct intelligence in the U.S.

The FCC's decision comes as the White House says it is making progress in talks with China on trade. The two countries for months have engaged in an escalating trade war, imposing steep tariffs on one another's imports. 

The administration has sought to limit Chinese influence over the telecommunications industry, including by banning Chinese companies from the U.S.

The White House has reportedly been considering banning U.S. companies from using equipment made by Chinese telecommunications companies Huawei and ZTE over similar national security concerns.

An FCC official told reporters on Wednesday that the concerns raised about China Mobile apply to all Chinese state-owned companies.