Attacking Shadows While Missing the Target: Why the FCC's Lab Ban Won't Secure Certification Infrastructure

All views in this newsletter are my own and do not represent the views of The R Street Institute, the US Navy, or any other organization I am affiliated with.

In On War, Carl von Clausewitz developed the concept of "Schwerpunkt." In German, this refers to "the hub of all power and movement, on which everything depends." English translations refer to this as "center of gravity." Attack the center of gravity, and the enemy collapses. Attack supporting elements while leaving the center intact, and you waste resources fighting shadows.

Military planners spend considerable effort identifying the correct center of gravity because attacking the wrong target guarantees strategic failure no matter how many tactical victories you accumulate. During the Gulf War, coalition forces identified Iraq's command and control infrastructure as the strategic center of gravity. Baghdad, was much more than a geographic location on a map. It was the center of gravity of Iraq's entire political and military organization. By targeting command structure rather than just engaging ground forces, the Iraqi military collapsed despite its numerical strength.

This year, the FCC made the opposite choice. In May 2025, the agency banned Chinese government-controlled certification laboratories from testing electronics bound for US markets. On September 8, they moved to withdraw recognition from seven more facilities. The actions address real vulnerabilities: FCC staff estimate that approximately 75% of US-bound electronics were tested in Chinese labs. This provided complete access to product designs, source code, and technical specifications months before market launch to organizations operating on behalf of the CCP. The problem with this action is that FCC attacked supporting pillars while leaving the center of gravity untouched: the international regulatory architecture that permits Chinese state-controlled entities to serve as trusted certification authorities within global trade frameworks.

The Bad Labs Rule Bans Chinese Facilities While Allies Keep the Door Open

The FCC's "Promoting the Integrity and Security of Telecommunications Certification Bodies" rule prohibits recognition of any testing lab where a "prohibited entity" holds 10% or more equity. Within four months, the agency moved against 11+ Chinese government-linked labs.

Chairman Brendan Carr articulated the security concern: "We don't want a Huawei spy gear box coming in the country with sort of a white label certification." Make no mistake, the threat is real. Certification labs receive complete product schematics, bills of materials, software source code, network architecture details, and electromagnetic compatibility specifications that represent a pre-market intelligence goldmine. Under China's 2017 National Intelligence Law, Article 7 states that "all organizations and citizens shall support, assist, and cooperate with national intelligence efforts in accordance with law." As a result, Chinese-controlled labs cannot refuse government demands for certification data.

The problem isn't what the FCC did, it's that they did it unilaterally. The European Union actively accepts testing from Chinese facilities for CE marking. Japan's PSE certification converts Chinese lab reports to Japanese certificates. South Korea accepts Chinese testing for KC certification. Australia explicitly advertises cost savings from using Chinese labs. The UK indefinitely recognizes CE marking, meaning products certified through Chinese labs in Europe automatically qualify for UK markets.

Mutual recognition agreements create the circumvention highways. The US-EU MRA, which has been operational since 1998 allows EU bodies to test products for FCC requirements. Chinese manufacturers can use Chinese labs for allied certification, leverage MRAs for US market access, and the system treats allied certificates as equivalent to direct FCC certification. The agreements contain no mechanisms to verify physical testing location or laboratory ownership structures.

The scale of the mismatch is remarkable. The FCC removed Chinese labs processing three-quarters of all certified electronics, forcing the remaining 119 US accredited facilities to absorb massive demand increases. Yet a product tested in a Chinese government-controlled lab in Shanghai can still reach American consumers if it gets CE certification first, then enters through the US-EU MRA. The policy attacks individual labs while leaving the system that validates those labs' work completely intact.

Center of Gravity Analysis Reveals the Strategic Error

Clausewitz distinguished between the center of gravity and its supporting pillars. Chinese certification labs are supporting pillars. They enable but do not constitute the core strategic objective. The actual center of gravity is China's position as a trusted certification authority within the international trade framework, backed by systematic infrastructure investments in developing nations through the Belt and Road Initiative's Digital Silk Road.

China spent two decades building this position through patient industrial policy. Chinese labs captured 75% market share by offering testing costs 30-50% below US and European facilities,10 driven by government subsidies that market economies cannot match without abandoning competitive principles. State-linked labs now serve as mandatory passage points for products entering global markets. This is the digital equivalent of controlling the Straits of Malacca.

The FCC's unilateral action against individual labs leaves this center of gravity completely unaffected. Chinese manufacturers simply route certification through European, Japanese, Korean, or Australian facilities that maintain no restrictions on Chinese testing. Products certified in Chinese labs reach US markets through allied MRA pathways. The regulatory architecture enabling Chinese certification authority continues functioning exactly as before, just with one extra step added to the process.

This violates the fundamental principle of center of gravity analysis: attacking supporting pillars while leaving the core intact wastes resources and achieves only temporary disruption. The policy created real costs. US manufacturers face 30-50% testing price increases, capacity constraints may delay product launches, and six major industry associations filed concerns about unnecessary reductions in global testing capacity. These costs fall primarily on American companies while Chinese certification infrastructure adapts through available circumvention mechanisms.

What a Coordinated Strategy Would Have Looked Like

Attacking the actual center of gravity requires transforming certification from a purely economic transaction into recognized security infrastructure. This means establishing coordinated restrictions on state-controlled lab certification across major democracies, implementing MRA security protocols that verify testing origins and ownership structures, and supporting certification capacity building in allied nations as collective security infrastructure rather than private market activity.

The economic scales support this approach. Democratic allies collectively command over $50 trillion in economic weight versus China's $19 trillion China remains dependent on Western markets and advanced technology inputs despite its manufacturing dominance. The question isn't whether democratic allies possess sufficient economic scale to prevail in certification infrastructure competition, it's whether they can muster enough political coordination to overcome decentralized profit incentives before China's position becomes unassailable.

The Bad Labs rule demonstrates that political will exists, as the FCC vote was 4-0 with bipartisan support. Technical solutions also exist, as alternative certification capacity can be built in allied countries. What's missing is coordinated execution transforming individual national actions into collective allied strategy. Until allied mechanisms address the regulatory architecture enabling Chinese certification authority, unilateral lab bans will simply push testing through third countries while preserving Chinese access to the intelligence goldmine that certification represents.

What This Means For...

Policymakers: The FCC identified a real vulnerability, but unilateral action against Chinese labs is insufficient without allied coordination closing circumvention pathways. The Trade and Technology Council should prioritize certification security, establish common restrictions on state-controlled labs across democratic allies, and implement MRA verification mechanisms. Otherwise you're just creating compliance costs for American companies while Chinese manufacturers route around restrictions through European or Asian certification.

U.S. strategic competition: China spent two decades building certification infrastructure as a strategic chokepoint while we optimized for short-term cost efficiency. Reversing this position requires industrial policy treating certification capacity as collective security infrastructure, not just private market activity. The alternative is continuing to attack individual labs while China's position as a trusted certification authority within international trade frameworks remains intact—attacking supporting pillars while missing the center of gravity.

Tech companies: Prepare for certification costs to increase 30-50% as Chinese lab options disappear, but recognize that allied certification pathways remain open for now. The strategic risk is that coordination eventually closes those gaps too, potentially requiring complete certification process redesigns. Building relationships with US and allied testing facilities now may prove valuable if circumvention routes close.

Aspiring strategic thinkers: Clausewitz's center of gravity concept remains essential for evaluating policy effectiveness. Before supporting any restriction or ban, ask: what is the actual center of gravity versus supporting pillars? Are we attacking symptoms or causes? What happens after we implement this policy if adversaries adapt through available alternatives? The FCC's lab ban demonstrates how tactical actions without strategic coordination can generate costs without achieving objectives.