FCC Cracks Down on Foreign Influence in Submarine Cables

The Federal Communications Commission (FCC) has introduced new rules to tighten its oversight of submarine cables, which carry 99% of international internet traffic. The move aims to ensure that no foreign adversaries, particularly Chinese companies like Huawei and ZTE, are involved in the supply chain of US submarine cable infrastructure.

The FCC's draft Second Report and Order targets a regulatory gap that has existed for decades, where terminal equipment on either end of submarine cables was not subject to licensing. The new rules require operators of Submarine Line Terminal Equipment (SLTE) to obtain FCC licenses and systematically exclude equipment and services from companies on the FCC's Covered List.

This means Huawei, ZTE, and HMN Tech are effectively locked out of US submarine cable infrastructure, with no exemptions or grandfathering of existing equipment. The move builds on actions taken by the FCC in August 2025, which introduced a presumption of denial for applications involving foreign adversary entities.

The rules will fast-track approvals for trusted domestic players, benefiting companies like Meta and Google that have been investing heavily in undersea cable projects to support their cloud computing and AI operations. The security and reliability of submarine cables are crucial for cross-border digital asset transactions, including cryptocurrency markets that operate on a global 24/7 basis.