TOKYO, July 4, 2022—The China State Administration for Market Regulations, Beijing’s antitrust regulatory body, is set to introduce new regulations that require foreign manufacturers conduct on the Chinese shores all production procedures for copiers and other office equipment sold in China. Makers that fail to comply the regulations to locally design and manufacture integrated copiers, projectors and other equipment that pack proprietary, sensitive technologies can be denied access to Chinese public sector procurement tenders.
The impending regulations are being drafted by the Chinese state agency as a ‘Information Security Technology Office Equipment Safety Rule,’ according to the Yomiuri daily newspaper July 2 that claimed to have obtained a draft copy. It said all office equipment ‘shall be completed domestically, from designing, research and development, and production,’ and that proposed safety regulations under the rule said the Chinese authority ‘shall inspect whether designing, R&D and production are completed locally in China,’ according to Yomiuri.
The office equipment that would be subject to the rule include integrated copiers with printing, scanning, fax, copying and other functions, the newspaper said. The rule would apply to telecom, transport, finance and other vital social infrastructure entities. The draft also singled out as ‘vital components,’ core regulation microchips, laser scanning devices, condensers, registers, micro-motors, as subject to local China design and production.
The impending rule is similar in nature to Japan’s ‘Japan Industrial Standard (JIS),’ administered by the Ministry of Economy Trade and Industry as a voluntary – yet compulsory as a self-imposed – regulation for most hi-tech products. In its 2021 white paper, the Japan chamber of commerce and industry in China warned that the rule can eventually legislated as a law.
Foreign manufacturers currently are conducting basic designing and R&D in their home countries and assembling sensitive parts as components as final products in China to be sold locally and exported to the United States, Japan and elsewhere. Apple for one is doing that exactly. Japan Rail, which developed the world’s first high-speed rail systems, had failed to take precautions about China’s aggressive technology theft. It invited Chinese engineers to its Japanese labs and also sent Japanese engineers to China for helping build China’s high-speed rail system that China boasts as its proprietary technology.
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