US tech giant Apple told its Taiwan suppliers on Friday that products moving to China must be labelled to state that the island is a part of China and not an independent nation, according to a report by Nikkei Asia.
Apple said parts made in Taiwan must be described as being made in “Taiwan, China” or “Chinese Taipei” as opposed to “Taiwan” or “Republic of China”, to fit Chinese customs regulations, as penalties for wrong labelling could result in a fine of up to $592 or shipments being rejected, the report said, as iPhone shipments from Taiwan were held for a long review of labelling last Thursday.
The new policy came shortly after US House Speaker Nancy Pelosi’s visit to Taiwan heightened America-China tensions and led concern that Beijing may increase trade barriers.
Apple iPhone assembler Pegatron Corp said its mainland China plant is operating normally, in response to a media report that shipments to Pegatron’s factory in China were being held for scrutiny by Chinese customs officials.
Taiwanese supply and assembly partners Foxconn and Pegatron are ramping up manufacturing efforts as Apple is set to launch its new iPhone in September.
Apple is now in the final phase of production for the iPhone 14 and may have felt unable to risk a setback, the Guardian reported.
Apple’s partners in Taiwan have been left in a dilemma, as they want the island’s independence recognized but may face the prospect of losing their business, it said, adding that the move to require suppliers to deny Taiwan’s independent existence had led to criticism from around the world.
- Reuters with additional editing by Alfie Habershon.
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