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FCC Inches Closer to Eliminating Chinese Telecoms Through Pair of Agency Actions

Huawei's logo on an office building

Vilnius, Lithuania - November 21, 2017: Huawei headquarter office building in Vilnius

The Federal Communications Commission (FCC) has upheld its previous determination that Huawei Technologies Co. poses a national security threat to domestic telecommunications. In a press release issued Thursday, the FCC called the move “another important step to secure the nation’s critical communications infrastructure.” In practice, the decision affirms the ban of expending money from the FCC’s $8.3 billion per year Universal Service Fund on Huawei equipment.

The FCC voted on Thursday to deny the company’s request that the agency revisit its June decision. In particular, the FCC’s review of the record concluded that “Huawei is susceptible to Chinese government pressure to participate in espionage activities, and that Huawei’s close ties to the Chinese military present significant risk.” Furthermore, the commissioners’ report found that other countries have banned the Chinese telecom’s equipment based on its vulnerabilities.

In another move on Thursday, the FCC initiated proceedings to revoke China Telecom (Americas) Corporation’s (CTAC) permission to provide domestic and international services. The press release explained that the decision was partly based on executive branch recommendations and CTAC’s response to an April order issued by an FCC subdivision requiring CTAC and two other telecoms to make a case against revocation.

CTAC’s showing, the FCC determined, was not satisfactory, over its arguments to the contrary. In turn, the agency formally initiated a proceeding to remove and terminate its authorizations under Section 214 of the Telecommunications Act. According to the FCC’s announcement, the proceeding will also examine whether CTAC complied with its 2007 letter of assurances to the Department of Justice, the Federal Bureau of Investigation, and the Department of Homeland Security.

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