AML, CCC and supply chain competitiveness

A report published by the U.S. Chamber of Commerce titled “China’s Drive for Indigenous Innovation” by James McGregor, describes rules regarding the Chinese Compulsory Certification or CCC mark and the Anti-Monopoly  Law or AML in China.  About 20 % of US exports to China are affected by the CCC – compliance requires paying for Chinese inspectors to visit US factories with the anecdote that “every new shade of lipstick or nail polish” has to undergo its own testing and certification.  AML defines market control as one firm with a 50 % share, two firms with a 66 % share or three firms with a 75 % share and demands compulsory licensing of intellectual property by dominant firms to encourage competition. The main question is whether such moves are legitimate efforts to protect Chinese consumers from poor quality goods or preferential treatment of domestic producers ? Is the market share perspective of control appropriate given that China is a growing economy or are they adhoc, given that state owned enterprises are exempt ? How should multinational react to these rules to protect their global supply chains, while serving Chinese consumers ?

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About aviyer2010

Professor
This entry was posted in Global Contexts, Operations Management, Supply Chain Issues and tagged , , , , . Bookmark the permalink.

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