China has ramped up scrutiny of foreign technology in its critical infrastructure, placing Nokia and Ericsson under opaque security reviews that differ from global standards.
These reviews occur behind closed doors, leaving European giants to face unpredictable delays in contract decisions and business operations.
President Xi Jinping’s administration has made telecom security a central focus of China’s tech agenda.
State-backed telecom buyers must submit every Nokia and Ericsson contract for review to the Cyberspace Administration of China; however, the foreign firms receive no information on how their products are evaluated or when decisions might be made.
What Security Reviews Are Being Forced on Nokia and Ericsson?
Under new regulations, contracts with Nokia and Ericsson are subject to intense and lengthy national security assessments.
These so-called ‘black box’ reviews can stretch for three months or more, with decisions made without transparency or disclosure to the vendors.
The process involves deep inspection of system components and local content requirements.
Unlike their Chinese rivals, Huawei and ZTE, which operate under fewer or no such review conditions, European companies face ongoing uncertainty.
The lack of access to criteria or timelines leads some contracts to be rerouted to local suppliers, heightening competitive pressure within China’s telecom space.
Did you know?
China now requires detailed documentation of every component from foreign telecom suppliers, but domestic competitors face no such requirement.
How Do These New Rules Affect European Suppliers?
The restrictions have impacted the positions of Nokia and Ericsson in the world’s largest telecom market. According to industry analysts, their combined market share in China has dropped dramatically, falling from about 12 percent in 2020 to just 4 percent in 2024 as Chinese government buyers opt for local alternatives.
Lengthy approval timelines mean European firms often lose contracts to domestic competitors.
Industry insiders say these security reviews, paired with documentation demands, severely disadvantage multinational vendors compared to Chinese counterparts who are exempt from the same scrutiny.
What’s Behind China’s Push for Local Tech Dominance?
China’s moves against foreign telecom suppliers reflect a broader campaign for technological self-reliance and national security. The government is prioritizing indigenous tech in infrastructure, citing concerns about foreign intelligence and data vulnerabilities.
Recent localization rules are intended to phase out reliance on overseas equipment. The push has been amplified by strained relations with Europe and North America.
Officials in Beijing argue that these measures are vital to safeguard critical networks; however, critics claim that the approach is designed to favor Chinese companies and sideline established global players, such as Nokia and Ericsson.
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How Are European Vendors Responding to China’s Measures?
European industry associations are registering mounting concern. The European Union Chamber of Commerce in China has called these restrictions “existential threats,” with nearly three-quarters of surveyed companies reporting losses due to the tightened requirements.
Nokia and Ericsson are pressing for reciprocity as only a handful of EU member states restrict Chinese firms in their own markets.
While some European governments have imposed bans or limits on Huawei and ZTE due to security concerns, China’s approach is more aggressive and systematic.
European suppliers urge Brussels to adopt similar standards, warning that continued inaction could further erode their competitiveness in the global telecom arena.
What Does This Mean for the Future of Global Telecom?
The situation highlights significant shifts in global telecom infrastructure, as China accelerates the decoupling of Western technologies and expands its support for domestic companies.
If this stance continues, Europe’s telecom giants will face shrinking opportunities in China, while homegrown suppliers will gain market share.
As security reviews become the norm, international technology providers may find themselves increasingly excluded from China’s booming digital sector.
Industry experts suggest that greater regulatory alignment and reciprocity are needed to restore balance in future global telecom partnerships, making this a pivotal moment for international tech standards.
China’s evolving rules are likely to spark further debate about technology sovereignty and fair competition, extending well beyond its borders. The next few years could reshape who builds and manages the world’s critical communication networks.
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