FCC Should Ban China Telecom Over National Security Risks, Justice Department-Led Review Says

Several federal agencies, including the Departments of Justice and Homeland Security, on Thursday have called on the Federal Communications Commission to revoke China Telecom's authorization to provide service in the United States.

Six executive branch agencies—the Departments of Justice, Homeland Security, Defense, State and Commerce, along with the United States Trade Representative—unanimously recommended that the Chinese state-owned telecommunications company be blocked from providing international services involving the United States.

"Today, more than ever, the life of the nation and its people runs on our telecommunications networks," said John C. Demers, Assistant Attorney General for National Security said in a press release. "The security of our government and professional communications, as well as of our most private data, depends on our use of trusted partners from nations that share our values and our aspirations for humanity. Today's action is but our next step in ensuring the integrity of America's telecommunications systems."

The relationship with China Telecom endangers national security and law enforcement, according to the agencies. The recommendation alleges that China Telecom inaccurately represented itself to both the public as well as the U.S. government. According to the report, the agencies are concerned about the People's Republic of China's (PRC) "role in malicious cyber activity targeting the United States" and that "China Telecom is vulnerable to exploitation, influence and control by the PRC government."

It also says China Telecom gave wrong information to the U.S. government about where its records were stored, "raising questions about who has access to those records."

The press release announcing the report also says China Telecom did not comply with a 2007 Letter of Assurance—a letter where China Telecom's outlined their commitments to the DOJ, Federal Bureau of Investigation and the DHS. But the press release did not detail the specifics.

In the letter, China Telecom agreed to make all billing records and subscriber information available to the U.S. The company also agreed that if U.S. law enforcement agencies request information from the company, they will not disclose the request, unless that disclosure is in accordance with legal requirements.

china telecom
China Telecom is accused of violating agreements with the United States government. STR/AFP/Getty

The report was the result of an April 4 executive order that established the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector. Previously, the Departments of Justice, Defense and Homeland Security were operating as an ad hoc committee called Team Telecom. The committee has oversight when it comes to FCC applications from foreign telecommunications companies.

"The FCC has been looking at this issue. We welcome the input of the Executive Branch agencies and will review it carefully," an FCC spokesperson told Newsweek.

The U.S. subsidiary of China Telecom is headquartered in Herndon, Virginia, and has offices across the country. The parent organization is the largest broadband operator in the world, boasting 135 million subscribers. It also owns and operates more than 51,000 miles of optical fiber across 70 percent of China. Over 670,000 people are employed by China Telecom, which ranked No. 141 on Fortune magazine's Global 500 list in 2018.

Update (4/10/2020, 4:15 p.m.): This article has been updated with a comment from the FCC.