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China reportedly uses satellites built and financed by US companies to connect military operations

Key Points
  • Bandwidth on satellites built by U.S. companies is used to connect Chinese soldiers at South China Sea outposts, the Wall Street Journal said in a report.
  • China's state police have also used the satellite services to help fight protesters, notably in a region where ethnic minorities were forcibly relocated, the report said.
  • The key to circumventing U.S. trade laws is a Hong Kong-based company called Asia Satellite Telecommunications, the report said, which is jointly owned by Carlyle Group and Chinese state-controlled Citic Group.
This aerial photo taken on January 2, 2017 shows a Chinese navy formation, including the aircraft carrier Liaoning (C), during military drills in the South China Sea.
STR | AFP | Getty Images

China makes use of nine satellites in orbit around the Earth, built by Boeing and Maxar Technologies-owned SSL and financed through investment firm Carlyle Group, to boost Chinese government capabilities, the Wall Street Journal reported on Tuesday.

The report found that bandwidth on the satellites is used to connect Chinese soldiers at South China Sea outposts, to boost propaganda broadcasts and to help state police fight protesters. In the final case, China's police force used satellite bandwidth to quell protests in Xinjiang, an area where the government has been sharply criticized for the forced relocation of of Uighurs, a Muslim ethnic minority in the province. China is said to have relocated as many as one million Uighurs into internment camps.

The United Sates has trade laws that essentially prevent U.S. companies from selling satellites directly to China or Chinese companies. However, those trade laws do not regulate how the bandwidth on those satellites is used once they begin operations – a loophole China has reportedly utilized to rent, rather than buy, the services of American-built satellites.

The State Department said the U.S. "strongly urges companies to implement stringent safeguards to ensure that their commercial activities do not contribute to China's human-rights abuses," in a statement to the WSJ.

The key to circumventing those trade laws is a Hong Kong-based company called Asia Satellite Telecommunications, the report said, which is jointly owned by Carlyle Group and Chinese state-controlled Citic Group. The report explained how AsiaSat was then able to buy satellites from Boeing and SSL, while Carlyle submitted compliance reports to the U.S. government. In turn, Citic Group then sold some services of the AsiaSat satellites to Chinese government operators. The uses of those services ranged from propaganda telecommunications to communicating with Chinese soldiers at remote outposts.

Boeing told CNBC in a statement that the company "follows the lead of the U.S. Government with respect to the use of export controlled items."

Citic has said the satellites have been used to help Chinese police communicate while fighting protests in both Tibet and Xinjiang. Additionally, China's intelligence agency, the Ministry of State Security, is reportedly listed among Citic's users "for emergency responses." AsiaSat told the WSJ that it did not know how Chinese authorities have used the satellites' capabilities in response to protests and that the company was unable to see what was transmitted.

Boeing was building a tenth satellite that would help the Chinese version of GPS satellites, a navigation system that could have both civilian and military uses. Boeing told the WSJ that this latest satellite's development is on hold.

Read the full Wall Street Journal report here.