Regulatory trend in EU: Chinese manufacturers get restricted in EU
Background
The European Union’s (EU’s) member states voted to use the bloc’s International Procurement Instrument (IPI) to restrict Chinese medical device manufacturers’ access to the EU’s public procurement market. Chinese firms will be prohibited from accessing public procurement contracts worth more than euro (EUR) 5 million for a period of five years.
History
2020: Made in China policy in medical device field and co.
2025-06 Decision in EU to restrict manufacturers of medical device from China in EU
Interview
Resource[1]
RUI: Hello and welcome to China ShortCuts,
MARIANN: the European Chamber’s weekly catchup on China’s business landscape.
RUI: This episode was recorded on 4th June 2025.
RUI: On 2nd June, European Union Member States voted to restrict Chinese medical device manufacturers’ access to the EU’s procurement market. The move constitutes the first use of the EU’s International Procurement Instrument or IPI. It follows an investigation launched last April, which concluded that foreign products only have minimal access to Chinese government procurement for healthcare equipment.
MARIANN: Chinese medical devices providers will now be blocked from bidding on relevant EU public procurement tenders with a value over EUR 5 million for a period of five years.
A lack of fair access to government procurement in China has been a longstanding issue for European companies operating in the country. It has been a key advocacy topic for the European Chamber’s Healthcare Equipment Working Group since the launch of the China Manufacturing 2025 initiative in 2015, which included market share targets for domestic high-end medical devices. In the European Chamber’s Business Confidence Survey 2025, 100 per cent of respondents in the medical devices sector reported missing business opportunities in China in 2024 due to market access and regulatory barriers, with ‘discrimination against foreign-invested enterprises in public procurement’ the top regulatory obstacle faced.
While caution should be exercised in the potential application of trade defence tools, the European Chamber supports the end goal of this action, which is to ensure that European companies have the same access to China’s procurement market as Chinese companies enjoy in Europe.
RUI: Data released by the statistics bureau on 31st May showed that manufacturing activity in China continued to decline for the second month in a row in May, as demand continued to contract.
MARIANN: The official manufacturing purchasing managers’ index or PMI stood at 49.5 points. This was the second month that the reading stayed below 50 points, indicating a contraction. That said, the pace of decline slowed compared to April, with most subindices improving from the previous month. However, while an improvement in supply meant that production edged back up to expansion territory, demand still missed the mark, with both new export and import orders contracting in May.
The official non-manufacturing PMI, which gauges services and construction activity stood at 50.3 points, with the pace of expansion dropping for the third consecutive month in May. This was largely due to a sharp slowdown in construction activity growth, due to weak demand.
RUI: Findings of a private survey released on 3rd June suggest that operating conditions in China’s manufacturing sector deteriorated in May, with both output and new orders falling.
MARIANN: The Caixin China General Manufacturing PMI stood at 48.3 points in May, down from 50.4 points recorded in the previous month. This marked the first time in eight months that the Caixin headline index fell below the 50-point benchmark, with the reading dropping to the lowest level since September 2022. A key factor behind the decline was a sharp fall in new orders, with export orders contracting for the second consecutive month. Despite this, expectations for the year ahead among surveyed manufacturers improved in May, with firms expressing hopes that the widening of export markets will contribute to an increase in sales.
Commenting on the data, Wang Zhe, senior economist at Caixin Insight Group warned that the downward pressure on the Chinese economy had significantly intensified at the start of the second quarter. He attributed this to the increased uncertainty in the external trade environment combined with headwinds in the domestic economy.
RUI: Following the escalation of tariffs and trade measures between the United States and China in April, the European Chamber conducted an online flash survey between 17th and 27th April 2025 to understand how its members have been affected. Shortly after, on 12th May, the US and China announced their decision to reduce tariffs on each other’s goods in a joint statement, with both sides cutting tariffs on each other’s goods by 115 percentage points for a 90-day period.
MARIANN: While the Chamber was encouraged by the decision, uncertainty remains, partly because certain tariffs have only been suspended temporarily and partly due to the erratic nature in which the tariffs were implemented in the first place. Therefore, while the survey results may no longer reflect the current picture that the initial round of tariff announcements had on Chamber members, they are still indicative of the influence that the US-China trade relationship has on overall business confidence. They also serve as an indicator of what a future deterioration in the US-China relationship might mean for foreign businesses operating in China, for example, if trade talks do not lead to an agreement following the 90-day tariff suspension.
RUI: The full report of the survey findings is now available to download for free from the Chamber’s website.
RUI: As the global digital transformation accelerates and the use of artificial intelligence proliferates, cross-border data transfers are becoming even more critical for European companies operating in China. However, compliance challenges are increasing in complexity, as both China and the EU have introduced their own regulatory frameworks for cross-border data flows.
MARIANN: The regulatory disparities between the EU and China necessitate significant investments from European enterprises to harmonise their data management practices. This includes finding ways to comply with the requirements of both jurisdictions regarding AI data localisation and cross-border data transfers.
RUI: Join us on 12th June online or in person in Beijing to hear legal experts from Europe share updates on key topics, including recent GDPR enforcement cases related to cross-border data transfers to China. In addition, drawing on real life experience and industry best practices, specialists from leading consulting firms will offer practical insights into building effective cross-border data compliance strategies.
Our analysis
We should follow up clear regulation in EU level and implementation action in national level. It would be not transparent how 27 EU counties handles own tender system.
Since not all medical devices are acquired through tender and once in sum of 5 Mio EUR. The most Chinese medical device will be not affected in short period.
This procurement will apply these stakeholders: Chinese manufacturer, distributor, importer and users (hospitals).
Chinese manufacturer
Who has tender in this sum of 5 Mio will be mostly affected.
Solution:
Establishment a legal manufacturer in EU and Rest of China and re-certify MDR
Establishment of legal manufacturer in EU with European partner (outsourced partner), as rebrand with same products and existing Chinese production
Distributor, importer and all sales in supply chains
Who has placed and distributed Chinese medical device in EU
Solution:
Find second supplier of similar product
Gap analysis of each EU countries tender policy
Pre-discussion with users (hospital)
Establishment of legal entity with Chinese partner in EU
Users (hospitals and Healthcare Providers & Patients)
Who had bought Chinese medical device will find a potential new manufacturer and distributor with similar device (higher price?). It could be a problem if they reply on only compatible medical device in China (as disposable).
Solution:
Stock of Chinese devices
Tactical action for tender
Pre-negotiation with distributor or Chinese manufacturer
Knowledge corner
EU
Directive 2014/24/EU on public procurement and repealing Directive 2004/18/EC Text with EEA relevance[2]
Regulation (EU) 2022/1031 on the International Procurement Instrument – IPI[3]
The IPI measure will take effect ten days after publication and apply only to new tenders.
Medical device regulation (MDR)[4]
European database on medical devices (EUDAMED)[5]
Where stakeholder could look after legal manufacturer of medical device certified for MDR and other economic operators.
China
Actually Chinese authority start made in China policy for medical device in early 2020s. In term of volume-based procurement the tender will favorited to domestic manufacturer if foreign device has no extraordinary medical purpose.
The results are regulation of accelerated registration of imported medical device and transferring of production site of medical device of foreign manufacturer in China. And the accelerate approval is actually rarely to see including new type testing, gap deficiency after submission and new establishment of Chinese GMP.
Made in China 2025 (European chamber)[6]
Medical device order (later law)[7]
Fast track of imported medical device[8]
[2] https://eur-lex.europa.eu/eli/dir/2014/24/oj/eng
[4] https://eur-lex.europa.eu/eli/reg/2017/745/oj/eng
[5] https://ec.europa.eu/tools/eudamed/#/screen/home
[6] https://www.europeanchamber.com.cn/en/china-manufacturing-2025
[7] https://www.easychinapprov.com/ordinance-739-nmpa
[8] https://www.easychinapprov.com/fast-track-of-approved-imported-medical-device