Nearly a decade after China's entry into the World Trade Organization, many foreign companies say the warm reception they once received has turned frosty. While China can still be highly profitable, some question how long that will last as Beijing changes the rules to give a lift to its domestic companies, especially state-owned enterprises.
A new government procurement program known as "indigenous innovation" features rules favoring local firms: It could block sales worth billions of dollars a year, says Joerg Wuttke, director of the European Union Chamber of Commerce in China.
Beijing has written strict standards for everything from cell phones to cars, often couching them in a way that gives an advantage to domestic producers.
A recently revised patent law could force foreign companies to hand over key technologies to Chinese bureaucrats. And anti-monopoly regulations have been used to limit foreign access to sectors such as construction machinery and energy.
"They have moved away from a level playing field to benefit their own companies," says Wuttke. Multinationals "are seeing the golden China opportunity become a mirage," says the China government relations chief of a major tech supplier, who would not be named for fear of reprisals.
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