The new rules are likely to be felt first in office equipment such as printers and multifunction copiers as early as next year.
A draft under consideration since April calls for these products – down to key parts like chips and laser components – to be designed, developed and manufactured in China. This goes beyond an earlier focus on safeguarding security technology to seek the creation of self-contained Chinese supply chains.
Providers of critical information infrastructure, a term covering fields such as telecommunications, energy, transportation and finance, would be required to purchase products that meet the national standards.
Foreign tech suppliers already shut out of government procurement lists could end up being cut off from a broader range of customers.
Chinese buyers purchase an estimated 900,000 to 1 million multifunction copiers a year, 40% more than those in Japan, another major market. Government purchases account for about 30%, but adding infrastructure and other fields considered state priorities – such as education and medicine – lifts the share to more than half.
Two agencies, the Standardization Administration and the State Administration for Market Regulation will issue a proposal for public comment this year, with an eye toward implementation in 2023. The standards may be expanded later to cover personal computers and servers.
In Japan, a major supplier of multifunction copiers, the prospect of the new regulations leaves Tokyo concerned.
Noting that the devices are connected to networks, a source at the ministry of economy, trade and industry warned that “there’s a risk of information being leaked if they learn about backdoors and other features that are inserted at the design and development stage”.
President Xi Jinping in 2018 oversaw the launch of “China Standards 2035”, a long-term strategy for developing tech standards. Though the status of the project is unknown, Beijing is believed to seek to use national standards to make its companies more competitive against American and other rivals. The planned changes fit with this goal.
“We mustn’t allow what happened with the shinkansen,” said an executive at a Chinese arm of a foreign company, referring to rail technology transfers that Japanese industry players have criticised. “We need a long-term strategy focused on the global market.”