*Thank you to Jacob Nash, 2026 Akin Summer Associate, for his valuable collaboration on this article.

• On June 25, the FCC adopted rules to increase FCC oversight over submarine cables, specifically SLTE, to improve the security and resilience of submarine cable systems and minimize national security threats.
• The rules: (1) establish a new licensing regime for owners and/or operators of SLTE which grants a blanket license, subject to exceptions; (2) adopt further national security-related routine conditions and certification requirements; and (3) presumptively exempt from Team Telecom review applications that meet ten national security standards.
• Existing submarine cable licensees and SLTE owners and operators have a number of new filing requirements and other obligations, both after the item becomes effective and when applying for modifications, assignments, transfers of control, renewals and extensions.

Overview

Submarine cable technology has advanced significantly over the past several years. The point of convergence of the optical and electrical signals for submarine cables has moved from solely beach landing points to data centers much further inland, leaving the physical connection point between the subsea and terrestrial networks more vulnerable to attack. Submarine line terminal equipment (SLTE) is the necessary technical equipment that converts optical signals carried on a submarine cable system into electrical signals, and vice-versa. SLTE plays an important role in connecting the internet’s infrastructure. Submarine cables, a critical backbone of the internet, carry the vast majority of transcontinental digital communications, including artificial intelligence (AI). SLTE owners or operators, similar to submarine cable owners, can have a significant effect on a submarine cable system, including by physically disrupting and manipulating the cables and the data carried thereon. The Federal Communications Commission (FCC or the Commission) has expressed concerns about the national security risks presented by foreign adversary entities holding ownership interests or affiliations with entities owning or operating SLTE. In its Second Report and Order released on June 25, the FCC seeks to address these national security concerns, promote the resiliency of submarine cable systems and mitigate threats from foreign adversaries. Specifically, the Second Report and Order does the following:

• Adopts rules to extend FCC oversight over SLTE, creating a blanket licensing regime under the Cable Landing License Act for SLTE operations.
• Imposes numerous new national security-related reporting and compliance obligations.
• Creates a process to streamline and expedite submarine cable applications from trusted applicants.

The new rules are intended to improve the security of submarine cable systems and reduce threats from foreign adversaries without imposing an undue administrative burden on trusted providers and entities.

History of FCC Efforts Related to Submarine Cables and National Security

In 2025, the Commission adopted a First Report and Order to modernize the submarine cable licensing regime. The Commission adopted a presumption against granting certain submarine cable landing license applications filed by entities owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary. Licensees that met the presumptive disqualifying criteria are now required to file a Foreign Adversary Annual Report each year. This First Report and Order also recognized SLTE as part of the overall submarine cable system for the first time.

SLTE Licensing Regime

In the Second Report and Order, the Commission concludes that it has authority to regulate entities that own and/or operate SLTE on submarine cables that connect to the United States. Going forward, any entity that owns and/or operates SLTE on a submarine cable landing in the United States must have a license either under the Cable Landing License Act or under the existing submarine cable landing licensing regime. The purpose of this requirement is to ensure that any entity that owns or operates SLTE is licensed by the Commission, closing a loophole that previously allowed some entities to effectively operate a submarine cable but avoid licensing, regulatory review and monitoring requirements. The Commission now grants a blanket license (by rule) to all entities owning or operating SLTE, except for those who fit the criteria for exclusion.

Exclusions

Excluded from the blanket license are entities subject to the Commission’s foreign adversary or character presumptive disqualifying conditions.

• Character presumptive disqualifying conditions. The blanket license is not available to an applicant that has, within the last 20 years, committed offenses related to violations of the Cable Landing License Act, fraudulent conduct, national security-related violations of the Communications Act or Commission rules, or failure to comply with the terms of a cable landing license.
• Foreign adversary presumptive disqualifying condition. The blanket license also is not available to an applicant that is owned, controlled by or subject to the jurisdiction or direction of a foreign adversary; is on the FCC’s Covered List; or whose authorization or license the FCC denied, revoked or terminated on law enforcement or national security grounds. The foreign adversary presumptive disqualifying condition also applies to current and future affiliates and subsidiaries of entities who fit into the last category.

These disqualifications will apply to entities seeking to own or operate a new SLTE on any current or future cables landing in the United States. “New” SLTE include SLTE that an entity did not previously own and/or operate prior to the effective date of the Second Report and Order.

Routine Conditions and Certification Requirements

SLTE blanket licensees must comply with eight new routine conditions, and these routine conditions are applicable 60 days after the rules are published in the Federal Register: 

1.  Compliance with all FCC rules and regulations.
2.  Compliance with any communications-related treaties or conventions to which the United States is or becomes a party.
3.  Compliance with any Commission action rescinding, changing, modifying or amending any rights accruing to any person by grant of the license.
4.  The licensee, or any entity controlling it, controlled by it or in common control with it, does not acquire any right to handle telecommunications to or from the United States unless authorized by the Commission under Section 214 of the Communications Act.
5.  Qualifying licensees must file SLTE Foreign Adversary Annual Reports.
6.  The licensee must file annual circuit capacity reports under 47 CFR § 43.82.
7.  A cable landing license is revocable by the Commission after due notice and opportunity for hearing or for failure to comply with either the Commission’s rules or the terms of the license.
8.  The licensee must implement a cybersecurity and physical security risk management plan with respect to its SLTE operations.

Foreign Adversary Annual Report

The Second Report and Order adopt a new reporting requirement, the SLTE Foreign Adversary Annual Report. Any SLTE owner or operator, regardless of qualification for the blanket license, must file the SLTE Foreign Adversary Annual Report if it:

1.   Is owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary.
2.   Is identified on the Commission’s Covered List.
3.   Has purchased, rented, leased or otherwise obtained or utilized equipment and/or services on the Covered List and/or is using those in the submarine cable infrastructure.
4.   Has had, or has a current or future affiliate or subsidiary who has had, an authorization, license or other Commission approval of any kind denied, revoked or terminated on national security or law enforcement grounds.
5.   Is licensed to operate a submarine cable system that lands in a foreign adversary country or the licensee’s SLTE is owned in or operated from a foreign adversary country.

The report will include information such as licensee information, location of the SLTE, type of ownership interest in the SLTE and certifications regarding the routine conditions listed above. The Commission has delegated to the Office of International Affairs the responsibility of establishing a filing date for the Annual Report, which will be announced at a later date.

National Security Certifications and Routine Conditions for New and Existing Submarine Cable Licensees

The Second Report and Order also adopts new national security-related certification requirements for submarine cable license applicants and existing licensees, and provides new routine conditions for existing cable landing licensees. The requirements below will not immediately apply to SLTE owners and operators. These requirements will become effective upon adoption of the rules, and existing licensees must file a certification of compliance in the International Communications Filing System (ICFS) within 60 days of the rules becoming effective.

Prohibition on the use of principal equipment produced by foreign adversary-controlled entities. Applicants and licensees must certify they meet a new routine condition that prohibits the use or addition of any principal equipment, including SLTE, that is produced by an entity owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary. Principal equipment means “the primary electronic components of the submarine cable system that supports it end-to-end and any other such equipment” that “performs the functions” that “licensees of a submarine cable system may use in the normal course of business.”

Licensees filing an application after the effective date of the Second Report and Order must ensure that no such principal equipment is used or added onto their licensed submarine cable system, by the licensee or any other entity. A new routine condition prohibits the same for all licensees. This restriction extends the existing requirement for cable landing license applicants to certify that they will not use equipment or services on the Covered List. Applicants in an initial application for a cable landing license, or for modification of a cable landing license after the effective date of the Second Report and Order, must certify that they meet this condition. Existing licensees must certify within 60 days of the effective date of the new rules that no principal equipment produced by foreign adversary-controlled entities will be added to their licensed submarine cable system for each system.

Prohibition on the use of foreign adversary-controlled third-party service providers. Applicants must certify in initial applications, and in modification applications, that no third-party service provider that is foreign adversary-controlled, identified on the Covered List, or able to access the cable from a foreign adversary country, will be used to provide services relating to the submarine cable system, nor will the applicant use such third-party provider in the future. A new routine condition prohibits the same for all licensees, including those whose cable license was granted prior to the effective date of the Second Report and Order. There are two exemptions to this condition. First, licensees that are themselves on the Covered List are exempt, given that the condition would not create a national security benefit in light of the fact that the entity already has been found to produce or provide equipment or services that pose a national security risk. Second, prohibited third-party service providers of critical repair and maintenance to the wet segment of submarine cables are exempt from the condition, due to the lower security risk of operations on the wet segments and the limited number of specialized repair ships available. If a prohibited third-party service provider is used, a disclosure letter is required within 30 days of each time the critical repair exception is used. Existing licensees must submit a certification for each submarine cable system within 60 days of the effective date of the new rules.

Prohibition on entering into indefeasible right of use (IRU) and leasing capacity arrangements with Covered List entities. Applicants must certify that they will not enter into a new arrangement or extend an existing arrangement, such as IRUs or leases for capacity, that would give an entity identified on the Covered List the ability to install, own or manage SLTE on a submarine cable landing in the United States. Applicants must certify that licensees, their customers or any downstream customers will not enter into or extend such agreements. This certification is also required for any applications for modification, assignment, transfer of control or renewal or extension of a license filed after the effective date of the Second Report and Order. Existing licensees must submit a certification within 60 days of the effective date of the new rules for each submarine cable system. The Commission says it expects substantial due diligence from licensees to ensure compliance with FCC requirements.

Foreign adversary ownership changes. Licensees must submit a certification reporting foreign adversary ownership changes within 30 days of the change. Licensees must report any change that results in the licensee becoming owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary. Certification is required in new applications, in applications for modification, assignment, transfer of control or renewal or extension of a license, and by existing submarine cable landing licensees.

Foreign adversary changes. Licensees must certify for each submarine cable system their acknowledgement of any new addition to the Department of Commerce’s list of foreign adversaries and whether or not the licensee is owned by, controlled by or subject to the jurisdiction or direction of the foreign adversary added to the Commerce Department’s list. The certification must be completed within 60 days of the update. Applicants for an initial application or application for modification, assignment, transfer of control or renewal or extension must include this certification. Existing licensees are subject to a similar attestation requirement pursuant to a prior FCC rulemaking addressing foreign adversary changes.

Covered List changes. All applicants and licensees must certify for each submarine cable system their acknowledgement of any additions to the Covered List. The certification must be submitted within 60 days of the change, which must include an attestation of whether the licensee uses the newly covered equipment or services and, if so, briefly explain for what purpose such equipment or service is used in its system. This requirement applies to applications for initial licenses, applications for license modifications, assignments, transfers of control, renewals or extensions, and existing licensees.

Address or geographic coordinate changes. Licensees must notify the Commission of any change of address or geographic coordinates provided under 47 CFR § 1.70005(e)(7) or (f). Licensees must submit a specific description of the updated information, including an updated map and geographic data, within 30 days of the change. Applicants must certify that they will comply with such requirements when filing initial applications, applications for modification, assignment, transfer of control or renewal or extension.

License non-renewal. Licensees must notify the Commission within 60 days prior to the date of license expiration if the licensee does not intend to seek license renewal or extension.

Submarine cable system retirement. Licensees must notify the Commission within 60 days prior to any retirement of the submarine cable system by filing a notification under the existing license number in the International Communications Filing System.

Streamlining and Expediting Submarine Cable Applications

The Second Report and Order also creates a process to streamline and expedite processing of submarine cable applications for certain applicants. Applicants who meet a set of ten national security standards will be presumptively exempt from referral to Team Telecom for processing. Additionally, some renewal or extension applications will be exempt from referral if Team Telecom reviewed an application filed by the applicant within three years of filing the renewal or extension application. Team Telecom will have 30 days from when an application is filed to object to its exemption.

Presumptively Exempt Applications

An applicant can presumptively qualify for exemption from referral to Team Telecom if it certifies:

1.   It is a licensee that either has a cable landing license that was granted by the Commission after November 27, 2020 and is conditioned on compliance with a mitigation agreement (or, beginning in 2028, it was granted a license within the last five years and is subject to either a mitigation agreement or to the exemption process established by these new rules) and has no new 10% or greater foreign interest holders since its most recent Team Telecom review.
2.   No cable system ownership below 5% is held by entities owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary and the applicant/licensee has not entered and will not enter into a financing agreement, strategic partnership or merger with a foreign adversary-controlled entity that may affect the management and operation of the submarine cable system.
3.   No senior official of the applicant or applicant’s parent company is owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary and will not perform duties with respect to the submarine cable system from a foreign adversary country.
4.   It will prohibit customers from entering into a new arrangement or extending an existing arrangement, such as an IRU or lease of capacity, where such an arrangement would give an entity that is owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary the ability to install, own or manage SLTE on the submarine cable.
5.   It will file a report with the Commission and Team Telecom on its arrangements, including IRUs or leases of capacity, within 60 days of commencing service and annually thereafter.
6.   The submarine cable system will not connect, directly or via a branching unit, with a submarine cable that is owned or operated by an entity that is owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary or that lands in a foreign adversary country.
7.   It will adhere to enhanced cybersecurity and physical security standards.
8.   It will report specified security incidents to the Commission and Team Telecom in writing within 72 hours.
9.   It will implement heightened physical and logical security controls.
10. It will adhere to ongoing monitoring and inspection by the Commission and Team Telecom to assess compliance with national security standards and routine conditions.

Next Steps

The FCC continues to stay active in this space; the Commission adopted a Second Further Notice of Proposed Rulemaking seeking comment on what routine conditions it should consider to improve oversight over SLTE owners and operators, and whether the Commission should adopt additional routine conditions for cable landing licensees subject to the Commission’s current licensing requirement. Comments will be due 30 days after publication in the Federal Register.

A portion of the new rules from the Second Report and Order, covered in this alert, will become effective 60 days after publication in the Federal Register. However, most of the rules in the Second Report and Order are subject to Office of Management and Budget (OMB) collection approvals, meaning that the rules will be effective 60 days after OMB approval. Please reach out to a member of the Akin telecom, media & technology (TMT) team if you have any questions or require additional information on this topic.