Nikkei Asia has reported from sources that smart device favorite Apple is urging suppliers to abide by Beijing’s customs regulations on parts sent from Taiwan to China.
This means that components from the self-ruled island would have to be labeled “Taiwan, China” or “Chinese Taipei” to be accepted into the mainland. Such names reference China’s assertion of Taiwan as its territory.
Chinese customs hold shipments of Pegatron, an iPhone assembler from Taiwan. over origin names as of August 4. The disruption occurred after its vice chairman met with the U.S. House Speaker Nancy Pelosi, who came to Taiwan despite heavy protest from Beijing.
Apple is now urging suppliers to follow suit with Beijing’s demand with urgency. If commodities appear by tags of the Republic of China, R.O.C, Made in Taiwan, or Taiwan, China will intervene with the delivery process and keep them for examination.
Apple has also instructed suppliers to prepare backup plans or swiftly evaluate and modify their labels on cartons and forms for shipments from Taiwan to China. This is to prevent shipping pandemonium and additional supply chain interruptions.
Nikkei Asia notes that Apple at present cannot afford component disruptions as it is preparing for autumn’s launching of new iPhones and other devices.
One source has disclosed that if China determines a violation, the penalty could climb up to 4,000 yuan (592 dollars). At worst, the shipment might be rejected.
Suppliers are also in the crosshairs of Taiwan’s demand, which wants all exports of Taiwan origin to be labeled by their official name.