The US House Select Committee on the Chinese Communist Party is urging President Joe Biden’s administration to designate Chinese tech giant Quectel as a military entity, restricting US investments in the company. In a letter addressed to Treasury Secretary Janet Yellen and Defense Secretary Lloyd Austin, Representative Mike Gallagher and Representative Raja Krishnamoorthi highlighted “significant evidence” suggesting Quectel’s potential contribution to the defense industrial base.
Describing itself as a global supplier of Internet of Things (IoT) solutions, Quectel’s IoT products facilitate communication between physical objects and computing systems over the internet. The committee expressed concerns about Quectel’s expanding market share in the US and its prevalence in smart devices nationwide, emphasizing its potential role in the Chinese military.
Quectel vehemently denied the accusations, labeling them as “false” and asserting that there is “no basis” for the company to be added to any US government restricted list. Norbert Muhrer, Quectel’s president, emphasized that their products are designed solely for civil use cases and pose no threat to US national security.
In September, Federal Communications Commission Chairwoman Jessica Rosenworcel raised national security concerns about Quectel, urging the Pentagon to consider declaring it a risk. The FCC expressed openness to collaboration in addressing the threat and potentially adding Quectel to its Covered List, prohibiting federal funds from purchasing equipment from sanctioned companies.
Lawmakers Gallagher and Krishnamoorthi had previously raised alarms about China potentially taking control of devices embedded with Chinese-made connectivity modules. The letter connects Quectel with the Chinese military, pointing out its involvement with Beidou, a navigation satellite system crucial to China’s military operations, and its role as a major supplier to Huawei Technologies.
Quectel’s modules were designed to integrate into Huawei’s platforms, a concern given the US ban on new equipment sales by Huawei in 2022 due to national security apprehensions. The committee noted Chinese media’s acknowledgment of Huawei’s reduced reliance on Western companies through Quectel’s modules, lessening vulnerabilities to US export controls and sanctions.
In 2021, President Biden’s executive order identified 59 companies linked to the Chinese military to prevent American investors from supporting Beijing’s military-industrial complex. The committee’s letter adds Quectel to the scrutiny surrounding the strategic links between Chinese tech firms and the country’s military objectives.