27th April 2020
Pamir Law Group
International buyers of PPE from China must ensure they are familiar with applicable Chinese regulations to insure they are buying product which is lawfully approved for export from a properly approved manufacturer. MSI's Taiwan law member Pamir Law Groups prepared this memo to provide a general understanding for international buyers to procure PPE from China.
The information provided includes the following three sections:
The coronavirus (Covid-19) pandemic is driving global demand for Personal Protective Equipment (“PPE”). China is one of the world’s largest producers of PPE. Many governments and private sector distributors currently seek to establish reliable supply chains to source PPE in China in order to lessen the impact of this outbreak in their countries. We can expect global demand for PPE to remain relatively high over the mid-long term, given that many governments are starting to realize that thorough preparation in advance and decisive action are the keys to properly respond to this kind of crisis in the future. This might lead many government as well as private health care providers and hospital systems to develop pandemic preparedness plans which may include among other steps, building emergency PPE stockpiles and building secure, sustainable procurement supply chains. In some countries government efforts and private sector efforts might both be needed to fill the void.
After numerous incidents involving substandard PPE being received by Spain, Netherlands, Turkey and other governments, the Chinese government moved to further regulate the manufacturing and export of PPE. In China PPE’s are classified into the following seven categories:
International supply chain procurement is complicated, and sourcing from China presents unique challenges. Below we try to highlight some important best practices which we hope will help governments and private buyers to procure PPE in China legally and safely. We are available to assist if required. See contact information below.
Permits and Approvals
Conduct proper due diligence on any potential manufacturers before starting discussions on price or purchase volumes. Only properly licensed PPE manufacturers in China are able to export their products. A qualified Chinese manufacturer must be able to produce documentation evidencing that they have all the approvals and permits below:
Capacity, Lead Times and Volume Forecasts
The demand for PPE worldwide is increasing rapidly and most of the Chinese manufacturers are already overloaded by the orders placed domestically. It is important to check the manufacturing capacity and lead time of the supplier at the very beginning to avoid wasting time on discussions with manufacturers that might not be able to fulfill your order in a reasonable time frame.
It is also recommended to discuss volume forecasts in the beginning to ensure that the manufacturer can continue to fulfill your orders over time as global volume demand increases.
Download the full article on: Sourcing Personal Protective Equipment (“PPE”) from China – Practical tips for international buyers
Pamir is a law and business consulting firm based in Taipei. The firm has a long track record of delivering practical business and legal solutions and successfully closing transactions for international, Taiwan and China based clients.
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