Washington blocks China Mobile from USA market

06 Juillet, 2018, 05:43 | Auteur: Auguste Feret
  • U.S. President Donald Trump. Leah Millis Reuters

Regardless of how it planned on offering its services, the NTIA (National Telecommunications and Information Administration) states China Mobile's entry to the market "would pose unacceptable national security and law enforcement risks", and the FCC is allegedly set to deny its application.

David Redl, assistant secretary for communications and information at the US Department of Commerce (DOC) penned a recommendation to the Federal Communications Commission (FCC) through the National Telecommunications and Information Administration (NTIA) on behalf of the Executive Branch, recommending that China Mobile's application be denied. "In 2019 we will do application experiments and trial commercial operation and in 2020 the technology will be in commercial use", said Zhang Yong, dean of the Network Technology Research Institute under China Unicom.

Asian stock markets wobbled on Monday amid rising US-China trade tensions.

China Mobile is a Chinese state-owned telecommunications company and also the largest telecoms carrier in the world.

With economic tensions between the two superpowers rising, the Trump administration has also moved to punish Chinese telecoms firm ZTE, banning United States companies from selling crucial hardware and software components to the company for seven years.

The Shenzhen-based company's presence in the USA "has been artificially restricted by unfounded allegations and suspicions based exclusively on misperceptions" about its relationship with China's government, Huawei said in a filing with the Federal Communications Commission that was made public on Tuesday.

The move comes amid growing tensions between the United States and China, after President Trump imposed tariffs on $34 billion worth of goods from China, as of 6 July.

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China Mobile had applied back in 2011 permission to enter the U.S. market, but this is being blocked over national security grounds.

At the time as per worldwide licensing procedures, the FCC requested comments from the Executive Branch on whether or not the license would be in the public interest. The company wasn't seeking to offer mobile services directly to United States customers, according to the USA filing. And having hammered telecoms equipment maker ZTE for sanctions-busting, Washington may start eyeing the US operations of tech giants Alibaba and Tencent.

China Mobile shares fell 2.2% to HK$68.20 as of 1:02 pm in Hong Kong, while the Hang Seng Index was 2.8% lower.

However, the timing makes it likely that the China Mobile block will fuel the burgeoning trade war between the USA and China, which was partly precipitated by Trump's assertion that the Chinese are trying to take advantage of the US via espionage and technology theft.

FCC spokesperson Tina Pelkey said the commission would review the filing.

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