EU bans masks, prostheses, and medical devices from China; excludes Beijing companies from EU public procurement

Brussels – A new trade spat between Brussels and Beijing: the European Commission decided to exclude Chinese companies from EU public tenders for medical devices worth over EUR 5 million. And it does so as a “proportionate response to the barriers imposed by China,” which, according to the EU executive, systematically discriminates against European companies in its tenders.

Just as preparations are underway for the end-of-July summit to celebrate 50 years of diplomatic relations between the European Union and China, the two partners (and competitors and rivals, Ed.) are adding fuel to the fire. Besides the friction over Beijing’s role in Russia’s war in Ukraine, there is still the issue of additional tariffs that Brussels imposed on Chinese electric car imports in response to subsidies that China provides to its battery-vehicle manufacturers.

The EU’s ban on face masks, prostheses, X-rays, and specialist diagnostic equipment and software produced in China follows the findings of a thorough investigation launched as early as April 2024 under the EU’s International Procurement Regulation (IPI). The European Commission essentially accuses the Asian giant of erecting “significant and recurring legal and administrative barriers to its procurement market.” According to Brussels, 87% of public procurement contracts for medical devices in China were subject to exclusionary and discriminatory measures and practices against EU-made medical devices and suppliers from the 27 member states. On the other hand, between 2015 and 2023, Chinese medical device exports to the EU “more than doubled.”

After “repeatedly raising the issue with the Chinese authorities seeking a constructive and fair solution,” the EU responded in kind. In addition to excluding Chinese companies from contracts worth over EUR 5 million, the inputs from China for successful bids will be limited to a maximum of 50 percent. The European Commission assures that the retaliation will not jeopardize the availability of devices that member states’ health systems need and that, in any case, “exceptions will be made in cases where no alternative suppliers exist.”

The EU Trade Commissioner, Maroš Šefčovič, reaffirmed his “commitment to dialogue with China to resolve these issues.” In a note, the Commission states, “Should China offer concrete, verifiable, and satisfactory solutions that effectively address the concerns identified, the IPI framework allows for the suspension or withdrawal of measures.” The immediate response from Beijing was not conciliatory: the spokesman for the Chinese Ministry of Foreign Affairs, Guo Jiakun, denounced the “double standards” of Brussels, which “acts in the name of fair competition while practicing unfair competition.”