The National Telecommunications and Information Administration, a section of the US Department of Commerce, said in a statement attributed to David Redl, assistant secretary for communications and information: "After significant engagement with China Mobile, concerns about increased risks to US law enforcement and national security interests were unable to be resolved.
"Therefore, the executive branch of the US Government, through the National Telecommunications and Information Administration pursuant to its statutory responsibility to co-ordinate the presentation of views of the executive branch to the FCC, recommends that the FCC deny China Mobile’s Section 214 license request.”
China Mobile had applied for the so-called Section 214 licence in 2011 to offer telecommunications service from inside the US.
Reuters reported that China Mobile had not responded to a request for comment, but quoted Chinese foreign ministry spokesman Lu Kang as saying in response to a query about China Mobile: "We urge the relevant side in the United States to abandon Cold War thinking and zero sum games.”
Kang said that Beijing always told companies to operate in accordance with market rules and to respect the laws of other countries where they were doing business, adding that the US should desist from putting what he described as "unreasonable pressure" on Chinese firms.
The Chinese telecommunications equipment maker ZTE Corporation has also faced difficulties in the US, and is in the process of trying to get back into business. It has reportedly thrashed out a deal with the Commerce Department, which includes paying a US$1 billion fine, depositing US$400 million in escrow in the case of future violations, and changing the personnel on its board.
But, while ZTE was severely affected by a seven-year export ban imposed on it by the US, Reuters said China Mobile would not be affected even half as much, as the company earns most of its revenue from operations in China.
Another Chinese telecommunications equipment maker Huawei Technologies faced problems in the US in January, with a deal for AT&T to sell its phones on plans being cancelled at the last minute.
And following this, Verizon was reported to have yielded to pressure from the US Government to stop selling Huawei devices. In February, US intelligence chiefs warned against the use of Huawei equipment.