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China Telecom’s US arm sues in last-ditch bid to retain license

The US subsidiary of China Telecom has filed an emergency appeal it hopes will prevent the impending revocation of the company’s license to operate in the USA, which the The Federal Communications Commission (FCC) terminated in October on grounds the carrier is a national security threat.

“Absent a stay, ChinaTelAmericas will be forced to cease significant operations, irreparably harming its business, reputation, and relationships,” according to the appeal filed with the US Appeals Court for the District of Columbia on Monday.

The carrier requested a decision by Friday, December 3, citing December 4 as the day the company must notify customers of service discontinuation.

The Chinese giant argued that the FCC rejected its request for a hearing and that there is no evidence it poses an imminent security threat.

“To date, this proceeding has spanned 18 months, during which time ChinaTelAmericas has continued to operate without incident, as it did for nearly two decades before that,” the appeal states.

The FCC terminated China Telecom Americas Corporation’s authority to provide telecom services within the USA on October 26, citing the telco’s potential for exploitation, influence and control by the Chinese government and other national security risks – including the ability to access or disrupt US communication, leading to espionage and other harmful activities.

While China Telecom denied it could, would, or has done anything of the sort, it did myseriously reroute European telco traffic through China in 2019 and was accused of doing similar things to US government communications in 2020.

The FCC’s decision didn’t make Beijing very happy, but China’s Ministry of Industry and Information Technology kept its objections quite mild, issuing a statement that accused the US of hiding behind the pretext of “national security” to act in an anti-competitive manner and violate international trade rules.

The US cracked down on other Chinese vendors last week on the grounds of security threats, as US president Joe Biden signed The Secure Equipment Act. The legislation prevents US regulators from even reviewing authorization applications for telecom equipment licenses on security grounds, thus eliminating concerns of a Beijing backdoor. ®