Beijing cries foul over U.S. telco bans

The Ministry of Industry and Information Technology, China's top industry regulator, on Thursday urged the United States to withdraw its decisions against two Chinese telecom companies. 

The comments came after Chinese telecom company Pacific Networks Corp and its wholly owned subsidiary ComNet (USA) LLC on Wednesday received an order from the U.S. Federal Communications Commission revoking their right to provide relevant telecom services in the U.S.

This is the latest move by the U.S. government to curtail the activities of Chinese telecommunications companies, experts said. The FCC has already revoked the licenses of China Telecom Americas and China Unicom (Americas) Operations to provide relevant telecom services in the U.S..

The MIIT said in a statement that it strongly opposes such decisions and urged the FCC to treat Chinese telecommunications companies fairly and in a nondiscriminatory way.

"China will continue taking necessary measures to safeguard the legitimate rights and interests of Chinese companies," the MIIT said.

According to the ministry, Pacific Networks Corp and ComNet (USA) LLC have been operating in the U.S. for years. They have always abided by U.S. laws and regulations, and provide high-quality services to many customers in the U.S. in accordance with commercial principles.

The MIIT said the FCC revoked their Section 214 authority without listing any facts to support the alleged legal violations, adding that it is an unreasonable suppression of Chinese companies by further overgeneralizing the national security concept and abusing state power.

Such practices seriously damage the U.S. business environment and harm the legitimate rights and interests of Chinese companies and global consumers, including U.S. users, the ministry added.

As Reuters reported, Jeffrey J.Carlisle, a U.S. lawyer representing Pacific Networks, said in a letter in January that the carriers "engage in very limited and small-scale facility-based operations in the U.S. that do not pose national security concerns ...The primary business of the companies is providing retail calling cards."

Xiang Ligang, director-general of the Information Consumption Alliance, an industry association, said the business activities of China Unicom and China Telecom were also fairly limited in the U.S., including offering overseas Chinese consumers domestic and international telecommunications.

The FCC decisions carry more symbolic weight than material impact, Xiang said, adding that such practices badly harm the U.S. business environment. China Unicom and China Telecom had been operating in the U.S. for about two decades before their licenses were revoked.

Bai Ming, a senior research fellow with the Chinese Academy of International Trade and Economic Cooperation, said the U.S. government is mixing politics with normal business collaboration and violating the rights and interests of Chinese companies and global consumers, including U.S. users.

"Such practices are also detrimental to global telecom cooperation," Bai said.