Given the growing influence of big tech firms in subsea cable investment, governments are intent on regulating underwater infrastructure for a modern world. In the second of a series of reports, we outline the existing subsea cable regulatory toolbox and suggest points of focus for new policy interventions.
Changes in the subsea cable market alongside growing anxieties around network resilience have renewed attention paid to the sector. The existing regulatory toolbox for the sector is largely used for security, economic growth and sustainability purposes.
The granting of permits to lay cables across jurisdictions can include planning, environmental and national security reviews. Subsea cable projects can be delayed by maritime planning reviews, in particular, given the more disruptive nature of other developments, including wind farms, that are captured by the same processes.
Governments have aimed to regulate subsea cable supply chains for both greater security and economic growth by restricting the use of certain vendors and investing in domestic production. The re-nationalisation of ASN in France and TIM’s Sparkle unit in Italy represent a revival of a centuries-old trend in sector intervention that reflects the global movement towards greater government control over the sector.
The shifting prioritisation of cable routing as a result of more tech-backed investments will require governments to reconsider their role in maintaining subsea connectivity in the future. Beyond investing to expand connectivity to regions with limited commercial appeal or to support the development of other digital sectors, policymakers will need to identify their responsibility for maintaining connectivity and building redundancy.
The ambitions of the US and China to exert political influence through foreign cable investment will force policymakers to balance improved connectivity against gaining economic competitiveness. This looming threat of dependency will underlie legislative debates around funding domestic cable maintenance capacity and improving international cooperation.
Market developments and geopolitical pressure have inspired renewed regulatory attention on subsea cables
Given the growing influence of big tech firms in subsea cable investment in the past decade and the ever-present geopolitical concerns around the security and resilience of subsea cable infrastructure, governments around the world have renewed focus on regulating the underwater network. High-impact communications outages, whether caused accidentally or as a result of suspected intentional damage to subsea cables, have driven policymakers to reconsider the importance of route diversity and redundancy to network resilience. Despite recently heightened media attention around suspected Russian and Chinese cable surveillance or tampering, the far more likely but still highly disruptive instances of incidental damage to systems, such as an incident involving the Asia-Africa-Europe 1 (AAE-1), TGN Atlantic, Europe India Gateway and Seacom systems in the Red Sea in 2024, should be a motivation for action from policymakers.
Beyond these fears around the physical security of underwater infrastructure, broader concerns about economic dependency and foreign investment in critical infrastructure have brought about greater scrutiny towards cable supply chains and coalition investment partnerships. These concerns have already begun to manifest through national policies on vendor restrictions for locally landed cables as well as refusals, particularly among tech firms, to work with certain vendors, regardless of landing sites. With the EU and other jurisdictions debating further regulatory intervention into the sector, we outline the existing frameworks for governing subsea infrastructure and discuss priorities for new legislation.
Regulation seeks to achieve improved network resilience, economic growth and sustainability
Both despite and because of their nature as critical infrastructure that connects outside national borders, subsea cables do not tend to fall solely in the remit of communications regulators. Because of the importance of global connectivity to the resilience of domestic terrestrial networks as well as the common use of subsea infrastructure as a tool in foreign economic development efforts, a number of public agencies tend to share responsibility for governing the network within any given country. Each of those agencies have distinct objectives for the sector and a unique set of regulatory tools to achieve those objectives (see Table 1).
In each context, the resilience and security of a country’s subsea cable connections tend to be the primary or motivating cause for action for policymakers. As the nature of threats to resilience may vary – such as differences between geological and geopolitical shifts – governments and regulators have used different policy responses to secure networks. The importance of secure connectivity to economic growth, particularly among countries seeking to compete in emerging technology sectors, is also a common, although lower priority motivation for regulatory intervention. Despite growing concerns around the interruption to aquatic ecosystems caused by cable laying and the volume of waste from retired cables, sustainability is a much lower, although potentially time-consuming, regulatory hurdle that new projects typically have to clear.
Variation in permitting periods for cable laying and repair can greatly impact the timeline of projects
The most common regulatory intervention into the sector is the planning and licensing processes projects face in most jurisdictions where a cable lands or is routed through. In Ireland, the An Bord Pleanála, the national planning body, must provide clearance for cable routes which land in the country or cross through territorial waters. Though the Irish permitting process is primarily based in maritime planning law, governments, including the US, are known to also condition licensing on national security clearances which require a review of other landing locations, investors in ownership coalitions and contracted cable vendors. Given the likelihood that planned cables are international, the need to navigate through multiple countries’ permitting processes can result in significant delays to project timelines, ranging from additional waits of six months to many years. Requirements for cable projects to receive similar permitting permission to other, more disruptive maritime projects, such as offshore wind farms, can also significantly extend these approval processes. Delays related to permitting also stand to delay repairs in the event of cable damage and can vary greatly. In the UK, repairs carried out to English cables can be conducted with assumed permission before permits are issued, greatly speeding up repair response times, whereas repair projects conducted in Scotland must receive permits before beginning work, thus slowing reconnection. Especially in the context of repairs or projects designed to improve redundancy, delays caused by the granting of permits could even be seen as hindering the resilience of a country’s connectivity, perhaps undermining a purpose of the regulation itself.
Like many other types of infrastructural projects, subsea cable projects are also commonly subject to environmental impact assessments, which are typically required as part of permit granting . In order to preserve coastal environments, projects may be required to make minor routing adjustments, alter plans for cable protection measures and mitigate interruptions to aquatic life during cable laying and maintenance. Some countries, including Australia, will also use maritime planning law to prevent activities in protected zones which may disrupt or threaten subsea cable infrastructure as well as aquatic ecosystems. In addition to causing delays in project timelines, both permitting and environmental assessments often carry an added cost to be borne by the cable project, though these costs are typically minimal in comparison to the broader economic value of the project.
Concerns over economic dependency have inspired the re-nationalisation of supply chains
As with other elements of the global network stack, governments have acted to better secure the supply chain for subsea cable manufacturing. Similar to concerns with the use of Huawei and ZTE components in other elements of terrestrial networks, policymakers are also increasingly wary of the participation of HMN Tech (formerly Huawei Marine of China) in cable deployment projects. In the EU’s recent Recommendation on subsea cable resilience, the bloc considered the potential for a “security toolbox” to effectively ban the vendor from supplying European cable projects. The EU’s proposal aligns with the US’s familiar campaign to prohibit the use of Chinese-sourced network components, including its Clean Cables initiative to specifically encourage allied nations to reject HMN Tech bids for cable projects. Through this initiative, the US Government reportedly lobbied successfully to award the South East Asia–Middle East–Western Europe (SeaMeWe) 6 cable contract to US-based SubCom over HMN Tech, denying the Chinese firm its largest project to date. Efforts such as these could reflect a fear of interference or espionage, although their likelihood is largely unproven, but also more likely highlight less tangible anxieties around economic dependency and failing competitiveness in strategic economic sectors.
In the context of this second, more economically-driven anxiety, a number of governments have also intervened in the subsea cable supply chain to gain public control over both cable production and deployment. In June 2024, the French Agence des participations de l’État (APE) announced it would be purchasing an 80% stake in ASN from Nokia, with plans to later assume 100% ownership of the French cable manufacturer. The Italian Government has similarly engaged in extended negotiations with former incumbent TIM to take over Sparkle, the operator’s subsea cable unit. Both governments cite an economic motivation to support the success of national companies but also a desire to advance the security objectives of the country, described by the APE as “defending the fundamental interests of the Nation”. The re-nationalisation of cable firms revives a centuries-old mode of government intervention into subsea infrastructure, dating to the UK’s Gutta Percha Company and Submarine Telegraph Company of the 19th century, and reflects the long history of common fears around sovereign communications infrastructure.
Domestic public investments are likely to become increasingly important in light of changing route priorities
Throughout the history of the subsea cable system, governments have also traditionally taken interventionist approaches to network development, dedicating public funding to the construction of cables for domestic connection. In some less commercially viable regions, including the smaller islands of Indonesia and the western coast of Canada, domestic government investment or investment through state-backed operators was required to construct any terrestrial connectivity to more remote, less populated communities. Government funding has also been leveraged to support the construction of strategic routes to domestic shores, both for improved resilience and economic gain. Both the EU and the Portugal have invested in the construction of the next iteration of the CAM ring, given its role as a critical connecting point in the Atlantic and its scientific value as a Science Monitoring And Reliable Telecommunications (SMART) cable. The Government of Vietnam has also announced its plans to construct 10 new subsea connections by 2030 to support its ambitions as a competitor in the emerging tech sector, especially after recent repeated faults to its existing lines.
Related to creating or maintaining domestic connectivity through public funding, governments will also be increasingly faced with the divergence of new and existing route priorities. As investment from tech firms makes up a larger proportion of new cable funding, the new routes planned by these firms appear less concentrated around the common corridors of connection built by governments and telecoms coalitions previously. This route diversity can improve the overall resilience of global subsea connectivity, such as through Google’s plan to circumnavigate the volatile South China Sea with its South Pacific Connect system (see Figure 1). However, some traditionally well-connected countries, such as the UK, will have to grapple with a potentially increasing lack of redundancy connecting to their shores as existing routes are retired in the future. Governments may therefore be faced with a greater priority on extending the lifespan of existing connections, through increased investment in maintenance, as well as taking on some costs of the construction of new projects. This divergence can also complicate the value that tech firms’ claimed investments in terrestrial network development through subsea cable laying holds to different governments in related public policy debates on the costs of network development.
The US and China have looked to foreign aid for cable projects as a means to exert political influence
Similar to other realms of foreign infrastructural aid, some countries, particularly the US and China, have identified subsea cable investments as an opportunity to influence allied foreign governments. Not unlike the political positioning underway in supply chain restrictions on cable manufacturing, both governments have offered direct funding as well as other forms of in-kind aid, such as technical expertise, to other countries pursuing new cable projects. Given the geopolitical importance of the South Pacific region, both China and the US have prioritised influencing plans for subsea connectivity in Japan, Taiwan, Vietnam, Australia and Singapore, among others. Through the CABLES programme and Belt and Road initiative respectively, the US and China are seeking to unify connectivity among like-minded countries. These efforts extend so far as aiming to quietly create a strategic dependency among some countries, especially in the Global South, on foreign support in a tactic that again dates to the colonial beginnings of the subsea telegraph network.
The softer or unofficial diplomacy of nationally aligned firms based in the US and China, has also served as a tool to exert influence over and increase dependency from allied countries. The strategic importance of Google’s private investments into transpacific connectivity beyond routes that land in the US has been recognised officially by the US Department of State and its Bureau of Cyberspace and Digital Policy. Comparatively, state-backed or affiliated operators China Telecom, China Mobile and China Unicom have together invested in nearly 55,000km of new cable to be ready for service between 2024 and 2025, including a number of projects that do not connect to Chinese shores, such as SeaMeWe6 and two strategic connections through India in the India Asia Xpress and the India Europe Xpress. In a debate familiar through other elements of the network stack, allied countries are faced with dependency not directly on foreign aid but on the continued cooperation of private firms with interests still closely aligned to their national governments.
Regulators should prioritise improving national maintenance capacity and fostering international cooperation
Beyond these existing levers for intervention into the subsea cable system, stakeholders from both the tech and telecoms sectors have emphasised additional priorities for governments and regulators in any new legislation or regulation for the sector. As referenced in the EC’s white paper on Europe’s digital infrastructure needs, future legislative efforts related to the sector are likely to be framed in the contexts of resilience and economic growth. Recommendations to improve cable maintenance capacity and foster greater international cooperation therefore both speak to the needs of private cable investors to better secure their investments. Public funding to increase cable maintenance vessels could improve fault repair times which remain highly disruptive to global connectivity at present. Larger national fleets of cable repair ships could also equip the sector to better maintain older routes and extend the lifespan of strategic connections. Expanded efforts to attract and train a skilled cable workforce will also be critical to extending the lifespans of these ageing cables. Support for cable resilience could also come in the form of improved protection of key landing zones to minimise disruptions. While fears rise around wilful interference with, or sabotage of, undersea connections, resourcing for the effective enforcement of cable protection laws as they apply to fishing or other maritime activities would target the most likely causes of cable incidents.
Given the international nature of most cable routes, improved cooperation among countries as well as within supranational organisations could harmonise, and ideally depoliticise, regulatory standards for cable projects and improve regulatory capacity to manage project oversight. Sectoral stakeholders have urged governments to place greater emphasis on collaboration through NATO and other, large international bodies as opposed to crafting regulation only based on localised or regionalised interests. The leadership of larger international bodies could also assist in off-setting the high costs of proposals to expand cable maintenance capacity and improve the sharing of best practices in permitting and other national-level regulation among regulators. Noting the ambitions of the US in particular to influence the sector globally, however, the EU and the UK, among others, must also consider the impact of greater international cooperation on their ability not only to connect with but also compete alongside the US in the future.
