FCC Commissioner Starks calls for closer scrutiny of submarine network permit applications

Republican Commissioner Geoffrey Starks of the Federal Communications Commission (FCC) used last week’s passage of new rules to govern the cross-agency review process of applications from companies with foreign ownership who wish to participate in the U.S. telecommunications market to suggest that closer scrutiny should be given in such a context to submarine networks. Given the importance of submarine networks to the smooth operation of the internet, submarine cables that land in foreign countries, are operated by foreign companies, or use technology for foreign companies may create a national security risk – particularly if China or Chinese companies are involved, asserted Starks.

The new rulemaking codifies the procedure that U.S. government agencies – collectively known as Team Telecom – use to evaluate the merits and potential security threat posed by telecommunications projects that involve non-U.S. companies. Team Telecom generally includes agencies of the Department of Defense, Department of Justice (including the Federal Bureau of Investigation), and Department of Homeland Security. The rulemaking will establish timeframes for these Executive Branch agencies to complete their review of such applications. The agencies will have a120-day initial review period, potentially followed by a discretionary 90-day additional assessment period. The Team Telecom review is part of the FCC’s public interest procedure on applications it receives.

The review process applies to the review of applications for such things as the provision of international telecommunications services, licenses to deploy submarine cables, and the transfer of control of a license to a carrier with reportable foreign ownership, subject to certain exclusions. Stark believes this second item warrants greater attention. “Because these cables are so important, we must ensure that adversary countries and other hostile actors can’t tamper with, block, or intercept the communications they carry,” Stark wrote in a statement released concurrent with the rulemaking.

Stark notes with approval that Team Telecom has taken a harder look at two recent submarine cable license applications that involved Chinese parties. The first, the Pacific Light Cable Network, involved Facebook, Google, and Hong Kong based Pacific Light Data Communication Co. Ltd. (PLDC) and would have connected Los Angeles and Hong Kong (see "Facebook, Google, PLDC back construction of the Pacific Light Cable Network"). Team Telecom objected to both to the presence of PLDC and the Hong Kong landing site; the parties eventually dropped the Hong Kong landing site to improve the chances the application will be approved. A similar situation occurred with the Bay to Bay Express Cable System that also planned to land in Hong Kong and had China Mobile as a sponsoring partner (see "Consortium chooses NEC for Bay to Bay Express Cable System"). That application was withdrawn.

“While undersea cable connections between the United States and China are appropriate, the Commission must work with Team Telecom to ensure that our communications are secure,” Stark asserted. To accomplish this goal, Stark proposes creation of what he called “a national security inter-bureau task force.” He also suggested that Congress should review whether the FCC’s authority to review the security implications of applications need to be updated.

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