December 15, 2018

Trump blocks Chinese Mobile entry in US on national security grounds

06 July 2018, 05:47 | Austin Hogan

Trump blocks Chinese Mobile entry in US on national security grounds

Headquarter of China Mobile in Beijing financial street

China Mobile, the world's largest telecom carrier with 899 million subscribers, did not immediately respond to Reuters' request for comment on Tuesday.

It warns that Chinese spying could be facilitated by the proposals and that wouldn't be limited to customers of the China Mobile proposed service, but anything that the network touched - and given that could include United States businesses, that's potentially bigger than the sum of its prats. That answer is officially no.

"The Chinese government could therefore seek to use China Mobile's common carrier status to exploit the public-switched telephone network in the Unites States and increase intelligence collection against US government agencies and other sensitive targets that depend on this network", the filing read.

Still, the 205-page, heavily redacted document offered a window into the U.S. government's assessment of national security risks of doing business with Chinese entities, especially one with ties to the Chinese government as close as China Mobile's and in an industry as critical as telecommunications.

The Trump administration moved against letting China Mobile Ltd. enter the US telecommunications market, saying the government-owned company would pose national security risks.

"The extreme delay in granting the application is causing significant and unwarranted harm to China Mobile USA's business operations", the company said in its letter to the FCC at the time. After more than half a decade, the FCC has its official response from the Executive Branch, which has advised it to deny the application, blocking the carrier's attempt to enter the U.S. market.

The US moved to block China Mobile Ltd. from entering its telecommunications market on national security grounds, launching another salvo in the fight between the world's two biggest economies days before they're expected to impose tariffs on each other over trade.

On Monday, another federal agency asked the FCC to block China Mobile Ltd from entering the USA market, citing national security grounds.

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China and the USA continue to spar over larger trade issues, raising concerns of a looming global trade war.

The US is set to impose tariffs on $34 billion of Chinese goods on Friday, with China vowing to retaliate.

While the move may be a setback for China Mobil, it will not have almost the effect that a ban of sales of equipment made by USA companies to China's ZTE has had.

China Mobile said it wanted to offer global voice traffic between the USA and foreign countries, and didn't intend to offer mobile service within the US, according to the NTIA filing.

America's ban on ZTE is affecting its business as far away as Europe, if Bloomberg's sources are right.

The company didn't intend to offer domestic phone and mobile services, but it would be able to connect to domestic networks.

According to a heavily redacted petition [PDF], the Executive Branch said it assessed that China Mobile is "vulnerable to exploitation, influence, and control by the Chinese government", adding that "China Mobile would likely comply with requests made by the Chinese government". The Trump administration wants to block its ability to do business in America, another casualty of an effort to keep Chinese technology companies from tapping into USA intellectual property.

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