Comply with labeling rules in China

Apple iPhone 13 on display in the Apple Store

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While the Chinese Communist government still acts in a very thorny way following the Speaker of the House by Nancy Pelosi recent visit to Taiwan, Apple is urging its suppliers to ensure that they label all shipments from Taiwan to China in strict compliance with Chinese customs regulations regarding the name of the island.

This is a critical time for Apple, which is gearing up to launch the next generation of iPhones this fall, and vendors are currently assembling various components for the new smartphones.

According to a Nikkei Asia report, Pelosi’s visit “has stoked fears of rising trade barriers”, making Apple nervous about “possible disruptions” if crucial shipments are delayed or even blocked at customs due to a failure to appease China’s labeling requirements:

Apple told its suppliers on Friday that China has begun strictly enforcing a long-standing rule that Taiwan-made parts and components must be labeled as being made in either “Taiwan, China” or “Chinese Taipei,” the company said. sources familiar with the matter told Nikkei Asia. , language that indicates that the island is part of China‚Ķ

Using “Made in Taiwan” on import declaration forms, documents or cartons could result in shipments being detained and screened by Chinese customs, the sources added. The penalties for violating such a rule are a fine of up to 4,000 yuan ($592) or, in the worst case, rejection of the shipment, one of the sources said.

This presents a dilemma for suppliers who need to ship materials, components or parts from Taiwan to China, as the democratically governed island also requires all exports to be labeled with the product of origin, meaning that they must bear the words “Taiwan” or “Republic of China”, the official name of the island, according to suppliers and logistics companies.

This is not a hypothetical problem, but rather a problem that is already happening. Shipments from Taiwan to facilities operated by Pegatron, an iPhone assembler, in Suzhou, China, were “held for review” on Thursday as Chinese authorities inspected import declaration forms and cartons to determine whether they were labeled “Taiwan” or “Republic of China”. Nikkei Asia reported.

A senior Pegatron executive was among several Taiwanese chip industry business leaders who attended lunch with Pelosi hosted by the Taiwanese president Tsai Ing-wen On Wednesday, the report noted, perhaps highlighting another reason why the company has found itself under heightened scrutiny.

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