Two anonymous senior U.S. officials alleged that China’s state-owned COSCO shipping group uses concealed shipboard equipment to collect military communications, a claim China’s embassy rejected and for which no vessel or equipment type was publicly identified. 2
By PAI
Sept. 2, 2026
WASHINGTON — Two senior Trump administration officials told Reuters that China’s state-owned COSCO shipping group uses concealed equipment aboard vessels to collect military communications near the coasts of the United States and other target nations. China’s Embassy in Washington rejected the allegation, and Reuters reported no public identification of a ship, equipment type, collection date or location. 2
The allegation was amplified in a LinkedIn post by David V. Gioe, Ph.D., which linked to Reuters’ report and offered the author’s five broader comparisons between China and Russia. The post did not identify additional evidence concerning a COSCO vessel or the alleged equipment. 1
A separate Sept. 1 LinkedIn post by Timothy Lawn, M.A., also circulated the Reuters report. Its sole visible image identified the vehicle carrier Kai Yuan Kou and marked possible antenna and electronics locations, but it labeled the image “ILLUSTRATIVE — NOT CONFIRMED ON THIS VESSEL” and said no equipment was visible or confirmed. Neither LinkedIn post adds public vessel-specific evidence to Reuters’ account. 1 14
Reuters reported that its sources spoke anonymously to discuss the U.S. assessment. The officials described the devices as sophisticated signals-intelligence platforms rather than routine communications hardware and said the alleged program enabled collection from vessels and aircraft across Europe, North America and Asia. Reuters did not publish the underlying assessment or technical details that would allow the allegation to be independently evaluated. 2
What the officials alleged
One official told Reuters that the purported equipment was intended to obtain information about military communications technologies and encryption developments. The officials also said the information was used to monitor shipping lanes and maritime routes and to support maritime reconnaissance and early warning concerning foreign military targets. Those are U.S. officials’ allegations, not publicly substantiated findings. 2
Signals intelligence, or SIGINT, is intelligence derived from electronic signals and systems used by foreign targets, including communications systems, radars and weapons systems, according to the National Security Agency. The agency says the work includes collecting and interpreting foreign communications and other electronic signals. That definition describes the type of activity the officials alleged; it does not identify the equipment Reuters reported on or establish that it was installed on COSCO vessels. 3
The distinction is important because Reuters’ account did not name a ship, identify a port call, describe a frequency band or say when any alleged collection occurred. It also did not state whether the officials’ assessment rested on physical inspection, technical collection, human reporting or another source. The public report therefore establishes that senior U.S. officials made the allegation, but leaves its evidence and scope undisclosed. 2
Reuters said the officials described a decades-long intelligence-collection partnership between COSCO and Beijing. It reported that COSCO did not respond to its request for comment. 2
China rejects the allegation
China’s Embassy in Washington said the Chinese government would never ask a company or individual to collect or provide data, information or intelligence abroad in violation of local laws, Reuters reported. Embassy spokesperson Liu Chang called the U.S. account “totally baseless” and said China opposed what she described as a narrative that vilified the country. 2
The denial directly conflicts with the officials’ account. Neither Reuters nor the U.S. government material cited in this report publicly released evidence that resolves that conflict. No public statement identified a government investigation, an enforcement action, a criminal charge or a specific vessel tied to the claim. 2
China’s 2017 National Intelligence Law provides relevant, but limited, legal context. The law was adopted June 27, 2017, took effect the following day and was amended in 2018, according to the NPC Observer’s legislative record. A Canadian Security Intelligence Service analysis says the law authorizes intelligence institutions to request necessary support, assistance and cooperation from relevant bodies, organizations and citizens, subject to legal authority. 8 9
That framework concerns the authorities of Chinese intelligence institutions and duties of cooperation. It does not by itself establish that a particular company, vessel or employee carried out the activity alleged by the U.S. officials. 8
Related research addresses a broader maritime question
Prior public research has documented Chinese use of civilian maritime resources for intelligence and military-related purposes, though it does not publicly corroborate the Reuters-specific COSCO allegation. A 2025 China Maritime Studies Institute report at the U.S. Naval War College said collecting and reporting maritime intelligence is a core mission of China’s maritime militia. 4
The report’s main findings describe specialized maritime-reconnaissance units and personnel who report to People’s Liberation Army-linked authorities. It also says PLA experts have argued for placing intelligence personnel aboard Chinese vessels operating abroad and assesses that the PLA was likely leveraging the latent intelligence, surveillance and reconnaissance capacity of distant-water fishing fleets and Chinese-owned or -operated merchant vessels. 4
That assessment is broader than the allegation reported by Reuters. It does not publicly identify COSCO, concealed shipboard equipment, a particular maritime route or an instance of military communications interception. Its relevance is contextual: It describes an analytic basis for considering how civilian vessels could support intelligence missions, while the Reuters report concerns an unverified allegation about one shipping group. 2 4
The Defense Department’s 2024 report on China also says the country’s National Defense Transportation Law, which came into effect in 2016, laid groundwork for mobilizing civilian maritime transportation resources and facilities for power-projection missions. The report separately describes China’s military-civil fusion strategy and civilian-sector technologies with potential military applications. 13
Those policies and assessments are distinct from evidence of a specific intelligence operation. The available public record does not connect the transportation law or the Naval War College report to an identified COSCO vessel or to the equipment described by Reuters’ sources. 2 4 13
Military-company listing is a separate U.S. determination
COSCO was already subject to a separate U.S. government determination before Reuters published its report. The Defense Department’s January 2025 list of entities identified under Section 1260H of the fiscal 2021 National Defense Authorization Act included China COSCO Shipping Corp. Ltd., COSCO Shipping (North America) Inc. and COSCO Shipping Finance Co. Ltd. 5
Section 1260H directs the Defense Department to publish an annual list of qualifying Chinese military companies that operate directly or indirectly in the United States. The department said the list is intended to identify, among other entities, military-civil fusion contributors operating in the country. 6
A June 2026 Federal Register notice provided DoD’s stated grounds for the COSCO designation. It said COSCO is directly owned and controlled by the State-owned Assets Supervision and Administration Commission, officially acts on behalf of the PLA and is indirectly affiliated with the State Administration of Science, Technology and Industry for National Defense. The notice also said DoD determined COSCO to be a military-civil fusion contributor to China’s defense industrial base. 7
The designation is not a public finding on the Reuters allegation. Its stated grounds address ownership, affiliations, military representation and support connected to Chinese military industrial planning. Reuters reported that the Section 1260H listing did not itself impose formal sanctions. 2 7
The difference matters for evaluating the record. A statutory designation can reflect DoD’s assessment of corporate and defense-sector links, while a claim of concealed signals-collection equipment concerns particular conduct that would require evidence tied to vessels, equipment or operations. The sources made public to date address those questions separately. 2 7
Commercial operations and trade policy remain distinct issues
COSCO’s North American website identifies commercial terminal ventures in Southern California. It says COSCO Shipping Terminals (North America) is a wholly owned subsidiary of COSCO Shipping (North America) and participates with SSA Marine and CMA Terminal Links in Pacific Container Terminal at Pier J in Long Beach. It also describes West Basin Container Terminal in Los Angeles as a joint venture among COSCO Shipping North America, Yang Ming Marine Transport Corp. and Ports America. 10
Reuters reported that COSCO remains among the major shipping companies calling at U.S. ports and has terminal-service joint ventures. The existence of those commercial operations does not substantiate the intelligence claim, but it is part of the setting in which the officials’ allegation arose. 2 10
U.S. trade policy involving Chinese maritime companies has followed a separate timeline. On April 17, 2025, the Office of the U.S. Trade Representative announced a Section 301 action addressing what it found to be China’s unreasonable maritime, logistics and shipbuilding policies and practices. The initial action set applicable fees at zero for 180 days, followed by phased fees on China-based vessel owners and operators and on operators of Chinese-built ships. 11
Those responsive actions are now suspended. A Federal Register notice said the suspension took effect at 12:01 a.m. Eastern time on Nov. 10, 2025, and runs through 11:59 p.m. Eastern time on Nov. 9, 2026. During that period, no party accrues liability for the maritime service fees described in the listed annexes. 12
The Section 301 action addressed trade and industrial policy, not the Reuters account of alleged shipboard intelligence collection. Its suspension does not resolve the allegation or China’s denial. 2 11 12
What the public record establishes
The public record establishes that two anonymous senior U.S. officials made a detailed allegation about COSCO equipment; that China’s embassy rejected it; and that COSCO did not respond to Reuters’ request for comment. It also establishes that DoD has designated COSCO under a military-company statute and that publicly available U.S. research assesses that China can draw on civilian maritime resources for intelligence and military purposes. 2 4 5 7
It does not publicly establish a named ship, an equipment model, an interception, the method by which the equipment was concealed or the dates and locations of purported collection. It likewise does not publicly show how the allegation relates to COSCO’s U.S. terminal ventures, the Section 1260H designation or the suspended Section 301 measures. Until evidence on those points is released, the reported activity remains an allegation attributed to U.S. officials and denied by China. 2 7 10 12