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US ban of China Telecom may affect its international partners and customers

MANILA, Dec. 16, 2021 (GLOBE NEWSWIRE) — Philippine legislator and House of Representatives Assistant Minority Leader France Castro has warned that the U.S. Federal Communications Commission’s (FCC) decision to ban China Telecom will affect the ability of its partners and affiliates around the world, such as Dito Telecommunity in the Philippines, to operate and serve its customers effectively given the tightening restrictions against its principal.

Due to national security concerns, the FCC adopted last October 26 an Order on Revocation and Termination, which directs China Telecom Americas to discontinue any domestic or international services it provides in the U.S. within 60 days of the order’s release.

The FCC determined that China Telecom “is subject to exploitation, influence, and control by the Chinese government”. Such control may allow China “to access, store, disrupt, and/or misroute U.S. communications.”

According to Castro, China Telecom’s US ban may have negative effects on the Philippines’ Dito Telecommunity – a telco that is 40% owned by China Telecom.

She explained that the termination of the China Telecom U.S. operations may prevent Dito from executing inter-connection activities in the U.S., such as roaming services for Filipino subscribers who need to make calls or send messages while overseas. Calls from Filipinos to their families or contacts in the U.S. through Dito may also be hindered.

Philippine lawmakers belonging to the House Committee on Information and Communications Technology are also monitoring the recent FCC order against China Telecom, given the Philippines’ own national security concerns about China.

Dito Telecommunity’s entry into the Philippine market earlier this year had already been marred by concerns about national security.

An industry report, entitled “A Study Into The Proposed New Telecommunications Operator In The Philippines: Critical Success Factors and Likely Risks”, and undertaken by Asia-Pacific consulting firm CreatorTech, had in fact described China Telecom as a fully-controlled entity of the Government of the People’s Republic of China (PRC). Its immediate reporting line is to China’s Ministry of Industry and Information Technology, which comes under the State Council of the PRC.

This is especially problematic for the Philippines given its ongoing territorial dispute with China over portions of the West Philippine Sea, the study found.

For more information:

France L. Castro
House of Representatives, Quezon City, Philippines
Rm. SW-511
Phone: (632) 8931-5001, Local: 7289
Direct: 8931-6193