FCC Proceeding to Withdraw Recognition of Accredited Test Laboratory
The Federal Communications Commission (FCC) Office of Engineering and Technology (OET) has instituted a formal proceeding (DA 26-744) to withdraw the recognition of SGS-CSTC Standards Technical Services Co. Ltd. Shenzhen Branch (CN1336) as an accredited test laboratory. This action is based on regulations designed to ensure that labs participating in the equipment authorization program are not subject to ownership, direction, or control by prohibited foreign entities that pose a risk to national security.
Regulatory Framework
Authority: Pursuant to Section 302(e) of the Communications Act and 47 CFR §§ 2.951(d) and (e).
Prohibited Entities: Section 2.902 defines "prohibited entities" to include "foreign adversaries" as identified by the Department of Commerce (15 CFR § 791.4), which includes the People’s Republic of China (PRC).
Control Thresholds: The Commission considers an entity "controlled by" another if there is 10% or more equity/voting interest, or if the external entity possesses the power to decide important matters or direct activities.
Case Background for SGS-CSTC Shenzhen
The OET's tentative determination for withdrawal is based on the following ownership and management structure:
Ownership: The lab is a joint venture where the China Standard Science and Technology Group Co., Ltd. (CSTC) holds a 15% stake. CSTC is wholly owned by the China National Institute of Standardization (CNIS), a PRC government entity.
Governance: While the majority shareholder is Swiss-owned SGS SA (via SGS Hong Kong), the PRC-owned CSTC appoints 30% of the Board of Directors, including the Chairman of the Board and the Deputy General Manager.
OET Finding: The OET concludes that the company has not sufficiently demonstrated that it is free from the direction or control of a prohibited foreign entity (the PRC).
Requirements for Continued Recognition
SGS-CSTC Shenzhen must file a response within 35 days of the Order (by approximately August 24, 2026) to contest the withdrawal. The response must include:
Ownership Disclosure: Detailed descriptions of all entities holding 5% or more interest and a vertical ownership organizational chart.
Corporate Governance: Copies of all policies, contracts, and agreements regarding decision-making and board appointments.
Personnel Backgrounds: Identification of all officers and directors, including their employment history and affiliations with the PRC government or the Chinese Communist Party (CCP).
Legal Compliance: Documentation regarding the company’s obligations under PRC laws, specifically the 2017 Cybersecurity Law, 2017 National Intelligence Law, and 2019 Cryptography Law.
Impact on Manufacturers and Type Approval
Manufacturers and type approval service providers should be aware that the FCC is actively enforcing "integrity and trustworthiness" standards for labs. Test reports from laboratories whose recognition is withdrawn may no longer be accepted for FCC equipment certification. Stakeholders should monitor the status of accredited labs, particularly those with complex international ownership structures involving designated "foreign adversary" nations.
