WASHINGTON – Concerned about possible cyber-spying, U.S. national security officials are debating whether to take the unprecedented step of recommending that a Chinese government-owned mobile phone giant be denied a license to offer international service to American customers.

China Mobile, the world’s largest mobile provider, applied in October for a license from the Federal Communications Commission to provide service between China and the United States and to build facilities on American soil.

Officials from the FBI, the Department of Homeland Security and the Justice Department’s national security division are concerned that the move would give the company access to physical infrastructure and Internet traffic that might allow China to spy more easily on the U.S. government and steal intellectual property from American companies, according to people familiar with the process who declined to be identified because the deliberations are secret.

Those officials, known collectively as “Team Telecom,” review FCC applications by foreign-owned companies. They could advise the FCC not to issue the license, but may instead demand a signed agreement designed to satisfy security concerns, the people said.

The review is being led by the Justice Department, which declined to comment, as did the FBI and DHS.

A move to block the license could provoke a lawsuit by China Mobile, officials said. But lately, the U.S. government’s focus on cyber espionage has sharpened considerably.

China Mobile, which has nearly 670 million subscribers, is not applying to provide domestic U.S. telephone or Internet service. But traffic from U.S. carriers, such as Verizon Communications Inc. or AT&T Inc., could be routed to the China-owned network should a license be granted.

“Suddenly, you’ve got a perfect ability to exfiltrate information out of the country,” said Scott Aken, a former FBI cyber security investigator.

A U.S. representative for China Mobile, who declined to be quoted by name, said the company is cooperating with Team Telecom’s inquiries and expects to satisfy any concerns through a national security agreement. The firm declined to address allegations about Chinese spying.

 

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