China denies claims of iPhone ban, but leaves vague hints

Amanda Liang, analysis 0

An Apple store in Hangzhou, the capital of Zhejiang Province. Credit: AFP

The Chinese government and state-owned enterprise employees have long been "discouraged" from using foreign brand smartphones, including Apple's iPhone, during official hours. Recent reports from The Wall Street Journal and the Financial Times have reignited discussions on this topic. In response, Chinese officials have officially stated that there is no explicit ban on iPhones.

However, Bloomberg reports that China's stance on Apple has become increasingly confusing. While Beijing authorities refute reports of iPhone restrictions, they have also raised concerns about the data security of Apple devices.

Chinese media outlet First Financial Daily reported that during a routine press conference at the Chinese Foreign Ministry on the evening of the 13th, a journalist from Japan's Asahi Television asked about media reports that some Chinese government agencies prohibit the use of Apple iPhones and inquired about the veracity of these claims.

Regarding this issue that foreign media has been discussing for a week, Chinese Foreign Ministry spokesperson Mao Ning stated that China has no laws, regulations, or policy documents that explicitly ban the purchase and use of foreign brand smartphones like Apple's. She emphasized that foreign investment rights would be protected by law, and China remains open to foreign businesses.

Indeed, after a week of heated discussions on this topic, the Chinese Foreign Ministry finally acknowledged the Japanese media's question and provided an official response. This timing might not be a coincidence and coincides with the day of Apple's new product launch.

While there might not be an explicit legal ban on iPhones in China, the widespread practice is challenging for Apple to navigate. China officially does not prohibit them, but they are "discouraged," which presents a silent challenge for Apple's sales team.

During the press conference, Mao clarified that apart from no explicit iPhone ban in China's laws or policies, she also left a hint by mentioning media reports of security issues related to Apple's phones. The Chinese government places a high emphasis on network and information security and expects foreign companies to strictly adhere to the People's Republic of China Data Security Law and the Personal Information Protection Law.

It's worth noting that on May 21st, Micron was informed by China's Cyberspace Administration that its products did not pass cybersecurity review and posed "significant" cybersecurity risks to China's critical information infrastructure supply chain. However, the specific Chinese regulations that Micron violated remain unclear.

While Beijing welcomes multinational companies to operate in the Chinese market, it consistently emphasizes that foreign businesses must operate in compliance with Chinese regulations. However, it raises questions about whether these regulations pose challenges for Apple's operations in the country.

As China's large language models (LLMs) also require approval and scrutiny by authorities before going online, with the introduction of generative AI into iPhones, how will Apple adapt to Beijing's control over data? In the past, Apple's data from Chinese users remained in data centers within China "in accordance with the law." However, in the AI era, what level of censorship will Chinese authorities impose, posing even more significant challenges for Apple than the so-called iPhone ban?