China is exercising control over internet cable projects in the South China Sea

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China has begun to block projects to lay and maintain undersea internet cables through the South China Sea as Beijing seeks to exert more control over the infrastructure that transmits the world’s data.

Long approval delays and stricter Chinese requirements, including permits for work carried out outside its internationally recognized territorial waters, have forced companies to design routes that avoid the South China Sea, according to multiple industry sources.

A cable under construction called SJC2, which will connect Japan to Singapore as well as Taiwan and Hong Kong, has been delayed by more than a year due to Chinese objections and lengthy permit issues, according to two industry executives.

For several months, China has suspended approval for seabed prospecting for the cable – owned by a consortium including China Mobile, Chunghwa Telecom and Meta – in its territorial waters around Hong Kong. According to one person directly involved in the project who requested anonymity, authorities have expressed concern that the contractor could engage in espionage or install foreign equipment.

“China is seeking to exert more control over undersea activities in its region, in part to prevent U.S. surveillance systems from being installed as part of undersea cable deployments,” said Bryan Clark, a former U.S. submarine officer and senior Navy official.

“The Chinese government also wants to know exactly where civilian undersea infrastructure is being installed for its own mapping purposes,” added Clark, who is now at the Hudson Institute think tank.

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Tensions over who owns, builds and manages the fiber cables that send internet traffic around the world have risen sharply since 2020, when the US government began blocking Chinese involvement in international consortium projects. Washington has also denied permission for undersea cables connecting the US to mainland China and Hong Kong.

Several industry sources said China’s policing of its waters – including within maritime areas marked on maps by a disputed “nine-dash line” – was a response to Beijing being shut out of international projects and fears that companies could used as a front for espionage.

Under international law, states or companies that lay and maintain internet cables require government permits to access the seabed within 12 nautical miles of a country’s territory. But permission is not typically required in waters between 12 nautical miles and 200 nautical miles from land, known as a state’s “exclusive economic zone.”

Chinese authorities have made the process for obtaining permits within the 12-mile stretch long and difficult, according to three industry executives with direct knowledge of the situation.

China is also one of a handful of countries in Asia that have begun requesting permits for cable-laying in claimed territorial waters beyond 12 miles, in apparent violation of international maritime law, according to executives at two major undersea cable companies in Europe and two lawyers who work with them. with companies in the region.

Workers in japan pull an undersea fiber optic cable from a ship in minamibōsō
Workers in Japan pull an undersea cable used for intercontinental internet traffic from a ship in Minamibōsō © Kyodo News Stills/Getty Images

Beijing claims almost all of the South China Sea and regularly disrupts rival claimants’ use of it for oil exploration and fishing.

“The edict from the [Chinese Communist party], relayed by local government representatives is that you need a permit in their EEZ,” said one submarine cable executive. “The last thing you want is to be approaching Chinese waters and a gunboat comes out and stops you. It’s just very dark out there [and] the cost of not doing so means people fold and apply [for permits].”

Requiring permits for cable work gives China oversight and influence over the entities that control the metal-encased fiber lines that carry data in Asia. It also gives Beijing leverage to demand a seat at the table for infrastructure projects by requesting that its companies, ships or personnel be involved.

The South China Sea is a popular undersea cable route, providing the most efficient route to connect East Asia with the south and west of the continent, as well as onward to Africa.

About 95 percent of all intercontinental Internet traffic – data, video calls, instant messages and e-mails – is transmitted through more than 400 active undersea cables spanning 1.4 million km.

Clark said China’s requirements were “not consistent” with the UN Convention on the Law of the Sea, noting that its permit requirements extended far beyond its EEZ to encompass almost the entire South China Sea. “Much of this area is actually the EEZ of China’s neighbors,” he added.

The Chinese Ministry of Natural Resources and Ministry of Defense did not respond to a request for comment.

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Several sources said that to avoid deadlocks over permits, undersea cable consortia are now trying to forge new routes that bypass China’s claimed waters.

Two cables under construction, called Apricot and Echo, will carry data from Singapore to Japan and the US respectively, avoiding the South China Sea by circling Indonesia.

“No one dares to do operations without express authorization . . . which never comes,” said a European submarine cable executive. Other projects under procurement will avoid the area because of these problems, he added.

The cost of contracting boats for cable laying and maintenance can run up to $100,000 a day, making companies reluctant to risk any action that could be blocked or sabotaged.

Avoiding waters claimed by China was a “double penalty”, the executive said, because it is more expensive to lay cables along the new route as the shallower waters near Borneo require extra layers of armor around the fibre.

“It means construction is longer and costs more,” said a Singapore-based CEO of a global technology company. “It’s digital infrastructure disconnect.”

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