Statement on the European Commission’s Decision to Restrict Chinese Firms’ Access to EU Procurement Contracts Under the International Procurement Instrument (IPI) Go back »

2025-06-04 | All chapters

Background

On 2^nd June 2025, 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. This action has been taken after the initial IPI investigation—concluded in January 2025—found that government procurement practices in China against foreign-invested medical device firms, unfairly encouraging Chinese hospitals to choose products produced by domestic manufacturers, with 87 per cent of contracts examined containing “direct and indirect discrimination.” Chinese firms will be prohibited from accessing public procurement contracts worth more than euro (EUR) 5 million for a period of five years.

The overall aim of the IPI, which first entered into force in 2022, is to achieve reciprocal access for EU companies to government procurement markets in third countries. The IPI can be triggered on the European Commission’s own initiative or following a substantiated complaint either by an interested party in the EU or by an EU Member State. The EU’s investigation into China’s procurement of medical devices in April 2024 was the first outing of the instrument.

European Chamber members in many industries have long reported experiencing discrimination in procurement processes in China, including those in the medical device industry. Receiving equal treatment in government procurement processes became a particular challenge for medical device companies following the launch of China Manufacturing 2025 (published in 2015), which called for domestically produced mid- and high-level medical equipment to achieve a market penetration rate of 50 per cent in China by 2020, and of 70 per cent in county-level hospitals by 2025.

Stance

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 we urge caution in the 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. The Chamber encourages both parties to work to achieve a negotiated solution, and stands ready to work with interlocutors from both the EU and China to achieve this endeavour.

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