FCC plans tighter rules to boost US firms in undersea internet cable market

WASHINGTON, D.C.―The Federal Communications Commission said on Wednesday it plans to toughen oversight of submarine communications cables that handle ‌99% of international internet traffic, proposing rules that will make it harder for Chinese companies to provide equipment and fast-track approvals for trusted U.S. tech firms.

The FCC said it was planning to require licenses for the first time for operators of submarine line terminal equipment, which perform the most critical function of a submarine cable system by connecting to U.S. terrestrial facilities.

U.S. companies such as Facebook parent Meta and Alphabet unit Google are likely to benefit from the process to get quicker approval to operate additional undersea cable systems to handle growing internet traffic.

The fast-track requires companies that operate cables to guard against espionage and other security incidents and strictly monitor compliance with national security and data security. Operators would also have to agree not to use foreign equipment that could pose security risks.

With the undersea internet cable business booming, the FCC last year barred the use of equipment or services in undersea cable facilities from companies on its list of companies deemed to pose threats to U.S. national security.

The firms that were barred included Huawei, ZTE, China Telecom and China Mobile, but the new rules are expected to expand the ban to include use equipment from China or any other foreign adversary in submarine cable systems.

For more than a year, U.S. officials have voiced concern about the network of more than 400 subsea cables that handle nearly all ‌international ⁠internet traffic and about threats from China and Russia.

U.S. Senate Foreign Relations Committee Chair Jim Risch (R―Idaho) in April urged new efforts to address growing national security concerns over submarine communications cables.

“To end undersea sabotage, we need to call it out when it happens and say publicly who did it, if possible,” Risch said. “We also need a concerted international effort to ​improve the resiliency of undersea infrastructure and prevent or mitigate the impact of ⁠these attacks when they happen.”

In 2021, the Justice Department said that national security agreements on submarine cables with Google and Meta were needed given China’s “sustained efforts to acquire the sensitive personal data of millions of U.S. persons.”

Reporting by David Shepardson; Editing by David Gregorio.