Brussels vetoes Chinese companies from public contracts for medical devices

It believes that European companies in this sector are discriminated against in Asia and is retaliating by closing off access to tenders worth more than €5 million, a market valued at €150 billion.

Europe is defending itself like a cat on its back in this new geopolitical environment. The European Commission has had enough and announced, with the support of the 27 Member States, that it will ban Chinese companies from medical device tenders .

The veto applies exclusively to public contracts valued at more than €5 million. According to EU sources, this threshold leaves Chinese companies without access to 60% of the public medical device market, valued at around €150 billion, but it is estimated that it will only affect 4% of tenders.

"It is essential that this decision does not cause any shortages or increased costs," these same sources assure. In fact, exceptions will be made in cases where there are no alternatives to Chinese supplies.

Furthermore, companies that win public contracts will not be able to import more than 50% of their products from China, a measure taken to prevent ghost fleets that could evade retaliation.

The medical devices affected by the European measures cover the entire spectrum, from masks to needles, crutches, and larger machinery such as scanners. According to the Commission, the Chinese blockade has also affected European companies across all products. The measures will apply only to public tenders for medical devices launched after the European decision comes into force, within 10 days.

The measure follows an investigation launched in April 2024 after it was found that China was limiting European medical device producers' access to its government contracts, something the EU executive described as "unfair and discriminatory." Following the publication of a 12-page report detailing that 87% of public tenders in China included dissuasive clauses or practices for European medical device companies, Brussels has decided to activate the European International Procurement Instrument (IPI).

This trade instrument seeks to pressure third countries to achieve a rebalance of relations regarding European companies' access to public contracts on equal terms. To avoid being considered a tool of attack, it establishes proportionality criteria.

Under its Made in China 2025 initiative, the Asian giant aims to ensure that by 2025 at least 70% of high-end medical devices used in hospitals are locally manufactured, a percentage that rises to 85% for strategic components and creates new obstacles for European companies trying to gain a foothold in the market.

"The EU's discriminatory decision and measures harm the interests of Chinese companies, undermine fair competition, and establish new trade barriers through unilateral measures," China's Ministry of Commerce recently stated.

The EU's retaliation comes at a time when both regions are trying to rebuild their relationship after past tensions that led to an exchange of tariffs. The two countries' clash with the US following the trade war unleashed by Donald Trump led to a diplomatic rapprochement.

A key milestone in this realignment is the next EU-China summit, now confirmed to be held in Beijing in the second half of July 2025. Despite the escalating dispute over public procurement, the Commission does not expect a tougher tone from China.

"Our goal with these measures is to rebalance the playing field for EU businesses. We remain committed to engaging with China to resolve these issues," said Trade Commissioner Maros Sefcovic.

If China were to reduce its barriers to European companies at any time, EU sources indicate that the procedure would be withdrawn.