Public procurement of medical devices in the EU: New restrictions on access for economic operators and devices from China

The Implementing Regulation stems from an investigation launched in April 2024 by the European Commission, which found that the PRC imposed systematic and discriminatory restrictions on European companies’ access to its public market for medical devices. The evidence gathered showed a picture of multiple barriers: preferences granted to domestic companies formalised in tender criteria, quantitative and qualitative restrictions on the purchase of imported goods, and economic conditions that made it unsustainable for foreign operators to participate. According to official Commission data, between 2017 and 2024, only 13% of the more than 380,000 Chinese public tenders for medical devices were awarded to European companies^[1] .

Despite consultations initiated by the European Commission, the PRC has not taken appropriate measures to remove restrictions that are detrimental to European companies. In this context, the Commission exercised the powers conferred on it by Article 6(6)(b) of the IPI Regulation, introducing direct and binding restrictions on access by Chinese companies and devices of Chinese origin to EU public procurement (‘IPI Measure’).

Restrictions imposed on operators originating in the PRC

The IPI Measure requires contracting authorities to exclude bids submitted by economic operators originating in the PRC in public procurement launched in the EU^[2] for the purchase of medical devices^[3] with an estimated value of EUR 5,000,000 or more, excluding VAT (Article 1 of the Implementing Regulation).

The measure applies to new tender procedures launched on or after 30 June 2025.

The origin of operators is determined in accordance with Article 3 of the IPI Regulation, which for legal persons refers to (i) the State in which the legal person is established, provided that carries out ‘substantial’ commercial activity within that State; (ii) if the legal entity does not carry out substantial commercial activity^[4] in the territory of the country in which it is incorporated, the origin is that of the company that can exercise, directly or indirectly, a dominant influence over that legal entity (e.g., the foreign parent company of an Italian company).

Furthermore, in the case of a tender procedure subject to the IPI Measure, contracting authorities must include in the tender documentation the obligation on the part of the successful tenderer not to subcontract more than 50% of the total value of the contract to economic operators originating in the PRC (or another third country subject to an IPI measure).

Restrictions imposed on devices originating in the PRC

Furthermore, pursuant to Article 8 of the IPI Regulation, in tender procedures subject to the IPI Measure, contracting authorities must require the successful tenderer to ensure, for the entire duration of the contract, that goods or services originating in the PRC (or in any other third country subject to an IPI measure) do not account for more than 50% of the total contract value, irrespective of whether such goods or services are supplied directly by the successful tenderer or through subcontractors.

The origin of the goods shall be determined in accordance with Article 60 of Regulation 2013/952 (as supplemented by Delegated Regulation 2015/2446) and Commission Communication 2023/C 64/04.

The main rules are:

• goods wholly obtained in a single country or territory shall be considered as originating in that country or territory; and
• goods in the production of which two or more countries or territories have contributed are considered to originate in the country or territory where they underwent their last substantial and economically justified processing or working, which resulted in the manufacture of a new product or represented an important stage in the manufacturing process.

Further specifications are contained in the aforementioned legislation.

Duration and derogations

The IPI measure has a duration of five years, which may be extended for a further five years. Within nine months of the expiry of the measure, the Commission may initiate a review procedure with a view to extending its duration, adapting it appropriately or replacing it with a different IPI measure by means of an implementing act.

Certain derogations are also provided: in particular, Article 9 of Regulation (EU) 2022/1031 allows individual contracting authorities to disapply an IPI measure (i) where ‘only tenders from economic operators from a third country subject to an IPI measure meet the tender requirements’; or (ii) for ‘overriding reasons of general interest such as public health or environmental protection‘.

The operational impact of this Regulation is significant for both contracting authorities and operators: exclusion clauses will be incorporated into the tender documents; bidders will be required to provide declarations on the origin of the devices offered; the truthfulness of such declarations will have to be verified; and any derogations must be duly documented and notified.

For EU economic operators, the measure could create increased opportunities to secure high value tenders. However, European companies may themselves be adversely affected by the new IPI Measure if they market products originating in the PRC.

[1] European Commission’s “Report on EU companies’ access to the Chinese medical device market“, attached to the proposal for Implementing Regulation (EU) 2025/1197.

[2] Pursuant to the Implementing Regulation, public procurement procedures falling within the scope of Directive 2014/23/EU, Directive 2014/24/EU, Directive 2014/25/EU.

[3] Pursuant to the Implementing Regulation, all medical devices falling under CPV codes 33100000-1 to 33199000-1 as defined in Regulation (EC) No 2195/2002.

[4] The criteria for determining ‘substantial’ activity in the territory and dominant influence are set out in Regulation (EU) 2022/1031 and Commission Communication 2023/C 64/04.