FCC Yanks China Unicom Americas Authority to Operate in U.S.

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FCC Commissioners unanimously adopted an order yesterday to revoke permission for China Unicom Americas to provide domestic interstate and international telecom services within the U.S. because of national security concerns. The document tells the company to stop operating here within 60 days of the order’s release.

China Unicom Americas is a U.S. subsidiary of a Chinese state-owned enterprise, China Unicom. Last March, the agency failed to dispel serious concerns from the FCC and Executive Branch agencies about the company’s ability to spy for China using its telecom equipment and software. The U.S. is worried about the Chinese government’s ability to access, store, disrupt, and/or misroute U.S. communications through the telecom. 

The Commission adopted procedures that enabled China Unicom Americas, the Executive Branch agencies, and the public to present any remaining arguments or evidence. During yesterday’s vote, Chairwoman Jessica Rosenworcel said the company’s conduct to the FCC and Congress demonstrates a lack of trustworthiness and reliability. “China Unicom America’s responses were misleading or incorrect.”   

FCC Commissioner Brendan Carr said that when the agency blocked China Mobile from entering the U.S. in 2019 because of national security concerns, it was time to review every carrier with ties to China. The action is the result of that review, he explained.

Carr also noted the FCC’s decision that China Unicom America’s presents “an unacceptable risk” appears sufficient to add the company to the agency’s covered list-telecom equipment that poses what the U.S. considers an unacceptable risk to this country, such as Huawei and ZTE. “Doing so could impose additional restrictions beyond the scope of our authorizations,” Carr explained.

Rosenworcel said she contacted the Department of Commerce, the FBI, NSA and other federal agencies so the FCC can update the covered list by this March. “That means we will confirm the status of other companies,” said Rosenworcel. “It is not enough to know where the risk is. We have to know where it is as well.”

Rosenworcel also explained the agency is preparing to launch a new data collection method that will require providers to report whether they have equipment or services in their networks that are on the covered list. The Commission is preparing to align its procedures with U.S. national security agencies “and ensure the FCC will not approve equipment for many companies on the covered list,” she said. 

Commissioner Geoffrey Starks said as information technologies advance, “one byproduct of universal connectivity is the potential vulnerability it creates. As our networks connect with others around the world, we will inevitably encounter bad actors, so we must remain on guard against efforts to intercept, tamper with, or block communications.”

Starks said the decision to revoke the telecom’s Section 214 authorization makes our country more secure, however more work remains. Companies that have lost their authorization can still offer their data center services to American customers. “The Department of Homeland Security has warned the data centers leave customers vulnerable to data theft,” said Starks. “These companies are required to separately share data with the Chinese government or other entities, even if the request is illegal under U.S. law.” He said the FCC lacks the authority to address this threat. “I think this administration, along with Congress, should examine this and determine whether the Commission needs broader authority to tackle this and other network security threats.”

The Commission plans to issue a consumer guide in English, Simplified Chinese, and Traditional Chinese on the FCC website, advising China Unicom Americas’ mobile service customers of the decision and raising awareness of other options.

By Leslie Stimson, Inside Towers Washington Bureau Chief

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