Two senior Trump administration officials have stated that Chinese state-owned shipping giant COSCO uses hidden onboard equipment to intercept military communications off the coastlines of targeted nations, including the United States.
According to the officials, who asked to remain anonymous to discuss the American intelligence assessment, COSCO maintains a decades-long espionage partnership with Beijing.
The arrangement reportedly enables China to gather signal communications from commercial and military ships and aircraft across North America, Europe, and Asia.
One official noted that the specialized hardware installed on the vessels is designed to help Beijing obtain information on "military communications technologies and encryption developments," while also monitoring strategic maritime transit routes essential for global trade and defense.
While COSCO did not respond to inquiries, the Chinese embassy in Washington rejected the allegations.
The claims surface shortly before President Donald Trump and Chinese leader Xi Jinping are scheduled to gather in Washington for a summit later this month, where they are expected to address sensitive economic and national security issues.
Although the officials refrained from detailing the specific hardware used aboard COSCO ships, they characterized the systems as "sophisticated signals intelligence collection" platforms rather than standard maritime navigation devices.
They added that Beijing utilizes the gathered intelligence to strengthen its position in maritime territorial disputes, conduct sea reconnaissance, and obtain early warning indicators concerning foreign military forces.
In response, China's embassy in Washington maintained that the Chinese government would never instruct any enterprise or individual to "collect or provide data, information or intelligence located abroad against local laws."
"We oppose vilifying China by peddling the so-called 'intelligence collection' narrative, which is totally baseless," embassy spokesperson Liu Chang told Reuters.
A study released by the U.S. Naval War College in April 2025 concluded that China's People's Liberation Army (PLA) likely utilizes the nation's commercial shipping and fishing fleets to support military surveillance and intelligence gathering.
In January 2025, the Pentagon added COSCO to its list of companies linked to China's military. The designation imposes U.S. government procurement bans and notable reputational damage, though it stops short of full economic sanctions.
Chinese law requires domestic corporations to support state intelligence operations. Nevertheless, COSCO remains one of the largest ocean carriers docking at American ports and maintains several container terminal joint ventures across the country.
To help revive domestic maritime and shipbuilding industries, the Trump administration outlined plans last year to impose billions of dollars in port fees on Chinese ocean carriers, including COSCO.
However, that measure was placed on hold after Trump and Xi reached an agreement last October for a year-long trade dispute truce. That arrangement is set to expire in November, and a potential extension is expected to be a key topic during the leaders' September summit.
Isaac Kardon, an expert in Chinese maritime strategy at Johns Hopkins School of Advanced International Studies, said Washington faces significant challenges in countering these security risks because of COSCO's deep integration into American trade networks.
"Taking COSCO out of our supply chains and transporter networks could be life-threatening surgery to U.S. trade networks," Kardon said.
