Page:2020-06-09 PSI Staff Report - Threats to U.S. Communications Networks.pdf/78

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Group Corporation ("China Netcom").[1] China Unicom was the resulting company.[2]

China Unicom (Americas) Operations Limited ("CUA") is China Unicom's American subsidiary and largest international affiliate.[3] CUA has operated in the United States since 2002, when it was granted its international Section 214 authorization.[4] Team Telecom, however, has never required CUA to enter into a security agreement, meaning it has not engaged CUA since its establishment.[5] Yet, CUA shares many characteristics with CTA and China Mobile USA, including government ownership, relationship to its parent entity, similar services and infrastructure across the United States, and partnerships with major U.S. carriers.[6]

1. The FCC Approved CUA's Section 214 Application in Two Weeks after Team Telecom Raised No Concerns

CUA applied for Section 214 authorization in July 2002 to provide facilities-based and resale services between the United States and all permissible international points, including China.[7] In mid-August 2002, consistent with its standard practice, the FCC asked Team Telecom to review the application for any

  1. ↑ China Unicom FY2019 Form 20-F, supra note 434, at 21-22. The Chinese government established China Netcom in 1999 to serve as the incumbent wireline provider in Northern China. However, by 2008, the Chinese government determined that China Netcom was too small to enjoy a competitive advantage and merged it with China Unicom. Briefing with China Unicom Americas (Apr. 16, 2020).
  2. ↑ Company Profile, China Unicom Group, https://www.chinaunicomglobal.com/us/company. See also Briefing with China Unicom Americas (Apr. 16, 2020).
  3. ↑ Briefing with China Unicom Americas (Apr. 16, 2020).
  4. ↑ CUA was initially established under the name China Unicom USA LLC. It converted from an LLC to a corporation in 2003. The company's name was officially changed to CUA following China Unicom's merger with China Netcom. See Briefing with China Unicom Americas (Apr. 16, 2020); Letter from Squire Patton Boggs, counsel to CUA, to the Subcommittee (Apr. 29, 2020) (on file with the Subcommittee).
  5. ↑ Briefing with China Unicom Americas (Apr. 16, 2020); Briefing with the Dep't of Justice (Apr. 3, 2020); Briefing with the Dep't of Homeland Sec. (Feb. 7, 2020); Briefing with the Dep't of Justice (Aug. 1, 2019).
  6. ↑ In discussions with the Subcommittee, CUA stressed that it also differs significantly from China Mobile USA and CTA with respect to shareholding structure, corporate governance, and history of compliance with the U.S. government. It further noted that there are many government-owned telecommunications carriers operating in the United States with operations and infrastructure similar to CUA. See Email from Squire Patton Boggs, counsel to CUA, to the Subcommittee (June 3, 2020) (on file with the Subcommittee).
  7. ↑ See Int'l Bureau Selected Applications Listing, File No. ITC-214-20020724-00427, FED. COMMC'NS COMM'N, https://licensing.fcc.gov/cgi-bin/ws.exe/prod/ib/forms/reports/swr031b.hts?q_set=V_SITE_ANTENNA_FREQ.file_numberC/File+Number/%3D/ITC2142002072400427&prepare=&column=V_SITE_ANTENNA_FREQ.file_numberC/File+Number (listing a filing date of July 24, 2002). As noted above, at the time of the application, the company was named China Unicom USA LLC. See supra note 439.

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