NTIA says that China Mobile’s 2011 application to serve U.S. telecom market should be denied
The Federal Communications Commission should deny China Mobile’s pending application to enter the U.S telecommunications market, submitted in 2011, the National Telecommunications and Information Administration said in a filing.
NTIA, part of the U.S. Department of Commerce, is the executive branch agency that advises the president on telecommunications and information policy issues.
In 2011, China Mobile applied for a Section 214 license through the FCC to offer telecommunications services from within the United States. At that time, the FCC requested executive branch views on whether the application for the license was in the public interest of the United States. NTIA noted that China Mobile intended to offer international voice traffic between the U.S. and foreign countries, and didn’t aim to offer mobile service within the U.S.
“After significant engagement with China Mobile, concerns about increased risks to U.S. law enforcement and national security interests were unable to be resolved. Therefore, the Executive Branch of the U.S. government, through the National Telecommunications and Information Administration pursuant to its statutory responsibility to coordinate the presentation of views of the Executive Branch to the FCC, recommends that the FCC deny China Mobile’s Section 214 license request,” said David Redl, Assistant Secretary for Communications and Information at the U.S. Department of Commerce.
The American intelligence community and other officials found that China Mobile’s application “would pose unacceptable national security and law enforcement risks,” according to the NTIA filing.
The filing also highlighted that China Mobile is wholly owned by the People’s Republic of China. “Because China Mobile is subject to exploitation, influence, and control by the Chinese government, the Executive Branch believes that granting China Mobile’s application would produce substantial and unacceptable national security and law enforcement risks,” the agency said.
In related news, Chinese vendor ZTE has appointed a new chairman and a new board as part of a deal with the U.S government to lift a seven-year export ban.
ZTE’s shareholders voted in Li Zixue, the deputy director of the Xi’an Microelectronics Technology Institute, as chairman, according to a Shenzhen Stock Exchange filing. ZTE also said its former board of 14 resigned as it elected a new board of eight.
That seven-year ban had been imposed by the Department of Commerce’s Bureau of Industry and Security (BIS) in March, after the vendor allegedly did not live up to the terms of an agreement that had been worked out after it illegally shipped telecom equipment to Iran and North Korea. In early May, ZTE said it had ceased its major operating activities due to the export ban.
Last month, the U.S government reached an agreement with ZTE which would allow the firm to resume business. Under the current terms of the agreement, the Chinese company must replace the boards of directors of ZTE Corp. and ZTE Kangxun. Additionally, all members of the company’s leadership at or above the senior vice president level also must be terminated, as well as any executive or officer tied to the export violations which led to the U.S sanctions.
In a recent filing, the Chinese vendor said it will pay a $1 billion to the U.S. government as part of a settlement agreement, as well as an additional $400 million in escrow.
ZTE also said it would resume operating activities as soon as practicable after BIS terminates the Denial Order.
