The European Union (EU) is set to implement new restrictions on medical device suppliers from the Chinese mainland in its public procurement processes. This initiative represents the first application of the EU’s International Procurement Instrument (IPI), a regulation that empowers the EU to limit access to public contracts for bidders from outside the bloc.
The move has raised concerns from the China Chamber of Commerce to the EU (CCCEU), which warns that it could complicate China-EU economic and trade relations. The CCCEU stated that the decision contradicts the EU’s stated principles of openness, fairness, and non-discrimination in market access. China’s Ministry of Commerce also criticized the measure, describing it as a protectionist step that may erect further barriers between China and the EU.
Currently, the EU offers access to its public procurement markets to countries that are part of the World Trade Organization’s Government Procurement Agreement (GPA). While China is not yet a member, it has been negotiating accession since 2007 and has made several offers to expand market access. Despite the lack of binding commitments, Chinese companies have participated in EU public tenders, often winning contracts due to the competitiveness of their bids.
The EU’s decision to restrict Chinese suppliers arises from concerns about reciprocal market access. European companies face challenges entering public procurement markets in the Chinese mainland, where policies often favor domestic firms to promote industrial development and innovation. The EU hopes that by applying restrictions under the IPI, it can encourage changes in China’s procurement policies.
Experts suggest that rather than imposing restrictions, both sides could take unilateral steps to demonstrate openness. For instance, China has considered granting equal treatment to foreign-funded companies in its public tenders, which could boost foreign investment, including from the EU. Similarly, the EU is reviewing its public procurement directives, which might result in new rules that facilitate participation by third-country bidders.
Open dialogue and mutual concessions may offer a path forward, promoting fair competition and strengthening economic ties. Restrictive measures, however, risk escalating tensions and hindering trade and investment between the two partners.
