China’s Pacific Networks Ejected From U.S. by FCC Over Security

·         Pacific Networks and subsidiary ComNet sanctioned by FCC

·         FCC acts again on Chinese telecommunications security fears

Photographer: Andrew Harrer/Bloomberg

By

Todd Shields

March 16, 2022, 10:33 PM GMT+7

The U.S. Federal Communications Commission ejected Pacific Networks Corp. and ComNet (USA) LLC from the U.S. market, continuing a series of bans of Chinese telecommunications companies over security concerns.

Wednesday’s 4-0 vote follows the agency’s January decision to bar China Unicom Hong Kong Ltd. Last year the agency barred China Telecom (Americas) Corp., and earlier it refused to let China Mobile Ltd. enter the U.S. market.

The move shows potential espionage and data theft by Chinese state-owned companies remains a concern under President Joe Biden after being elevated as an issue by his predecessor, President Donald Trump.

Previous story: U.S. FCC Moves Toward Banning More Chinese Wireless Carriers

Pacific Networks and ComNet primarily sell retail calling cards in the U.S., the companies said in a January filing. Shareholders include investors from the U.S., the U.K. and the European Union, the companies said.

“The participation of significant levels of public, international ownership show the companies are very different from a 100% state-owned company not subject to external transparency and accountability requirements,” the companies said in the filing.

Pacific Networks is 100% owned by Citic Telecom International Holdings Ltd., a publicly-listed company on the Hong Kong Stock Exchange, according to the filing.

Pacific Networks and ComNet earlier told the FCC their operations aren’t subject to Chinese government control, and had complied with FCC requirements. Their parent company is state-owned Citic Group Corp.

The FCC’s actions against Chinese carriers have drawn attention in Beijing, with Chinese Foreign Ministry spokesman Zhao Lijian in January saying the U.S. was using security as a pretext to revoke the license of a Chinese company. He called it “an abuse of state power to suppress Chinese companies.”

https://www.bloomberg.com/news/articles/2022-03-16/china-s-pacific-networks-ejected-from-u-s-by-fcc-over-security

US Bars Chinese-owned Telecom Over 'Security Risks'

By AFP - Agence France Presse

March 16, 2022

US regulators on Wednesday stripped Chinese state-owned Pacific Networks of its telecommunications license, the latest blow in the simmering confrontation between Beijing and Washington.

Washington had previously revoked the permits of China Telecom and China Unicom, and the Federal Communications Commission has now given 60 days to Pacific and its subsidiary ComNet to cut service.

"The companies' ownership and control by the Chinese government raise significant national security and law enforcement risks," the FCC said in a statement, adding Beijing could monitor or disrupt US communications.

ComNet did not immediately reply to a request for comment.

The revocation of Pacific's operating authority comes as US President Joe Biden has pressed ahead with a strategy of confronting China broadly in line with that of his predecessor Donald Trump, whose approach sent tensions soaring.

Relations have been fraught between the world's two biggest economies on multiple fronts, including trade, human rights, Taiwan and the Covid-19 pandemic.

China Telecom is China's largest fixed-line operator, but it had faced trouble in the United States for years, particularly during Trump's presidency, as his administration repeatedly clashed with Beijing over trade.

The telecoms companies have fought back against the restrictions, with China Unicom saying in a statement in January that the FCC's decision was "without any justifiable grounds and without affording required due process."

jm/sw

The Barron's news department was not involved in the creation of the content above. This story was produced by AFP. For more information go to AFP.com.
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