US expels another Chinese phone carrier on security grounds

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BEIJING — Washington has expelled another state-owned Chinese phone carrier from the U.S. market over national security concerns amid rising tension with Beijing.

The Federal Communications Commission revoked authorization for Pacific Networks Corp. to provide domestic and international service under an order issued Wednesday.

The U.S. government is reducing Chinese access to American markets and investment over possible spying and Beijing’s military development.

A Chinese flag is raised during a medal ceremony for the women's freestyle skiing big air at the 2022 Winter Olympics (AP Photo/Jae C. Hong)

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The FCC cited "significant national security and law enforcement risks" that Pacific Networks could monitor or disrupt U.S. communications. It said there were no steps that could eliminate those risks while the company operated in the United States.

President Joe Biden has extended efforts begun under his predecessor, Donald Trump, to limit access to U.S. technology, investment and markets for Chinese companies due to concern they are security risks or helping military development.

In October, a unit of China Telecom Ltd., one of China’s three main state-owned carriers, was expelled by the FCC from the U.S. market on similar grounds.

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The FCC said in 2019 it planned to revoke licenses granted two decades earlier to China Telecom and another state-owned carrier, China Unicom Ltd. It rejected a license application by the third carrier, China Mobile Ltd.

Anonymous hacker in front of his computer with red light wall backgroundAnonymous hacker in a black hoody with laptop in front of a code background with binary streams cyber security concept. (istock)

The FCC also cited unspecified "conduct and representations" by Pacific Networks to regulators and Congress that "demonstrate a lack of trustworthiness and reliability."

Pacific Networks owns an American company, ComNet (USA) LLC, which provides international service, calling cards and global SIM cards, as well as network management, business phone systems and website services, according to a U.S. Senate report in 2020.

Freshmen take part in a military training at Southeast University on October 22, 2021 in Nanjing, Jiangsu Province of China. (Yang Bo/China News Service via Getty Images)

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The companies ultimately are owned by the Chinese Cabinet’s main holding company, CITIC Group, which "may be able to access U.S. customer records," said the report by the Senate’s Permanent Subcommittee on Investigations.

The companies are obligated by Chinese law to "support the Chinese government’s intelligence work," the report said.