US regulators denied a request by China Mobile to operate in the US market and provide international telecommunications services, saying links to the Chinese government pose a national security risk.
The Federal Communications Commission said that because of China Mobile USA's ownership and control by the Chinese government, allowing it into the US market “would raise substantial and serious national security and law enforcement risks.”
Beijing slammed the US for the “unreasonable suppression” of China Mobile after US regulators denied the telecom giant's request to operate in the US market, citing national security concerns.
“We urge the US to... stop the wrong practice of always using national security (as a pretext), and stop the unreasonable suppression of Chinese enterprises,” Chinese foreign ministry spokesman Geng Shuang said.
The decision brings the Chinese telecoms giant's eight-year effort to crack the US market to an end, but was not really a surprise since FCC Chairman Ajit Pai had publicly opposed the company's application last month.
China Mobile - the world's largest mobile operator with nearly 930 million customers as of February - first filed an application for permission to operate in the United States in 2011.
The five-member FCC said in a statement that the decision was made after “extensive review” and “close consultation” with national security and law enforcement agencies. It also marks the first instance in which executive branch agencies have recommended that the FCC deny an application due to national security and law enforcement concerns, the statement said.
The move comes as Chinese tech firms - such as Huawei and ZTE - have faced stiff resistance from US government agencies, which have described them as security threats.
Defense of intellectual property in China and getting fair access to that country's markets have long been points of concern for US tech companies. They are also considered hard-to-fix problems when it comes to trade between the US and China. Meanwhile, technology has become increasingly vital to national security and economies.
Denial of the China Mobile request came as US President Donald Trump held out hopes of salvaging a trade deal with China, just hours before Beijing's negotiators were due to return to the bargaining table amid a sudden flare-up in hostilities.
Since last year, the two sides have exchanged tariffs on more than $360 billion in two-way trade, gutting US agricultural exports to China and weighing on both countries' manufacturing sectors.
The International Monetary Fund also repeated its warning that the trade battle between the world's top economies was a “threat” to global growth.
