China Could Ban iPhone Use for State Agencies and Companies

China is reportedly planning a wide-ranging ban on Apple iPhones for government workers.

As Bloomberg reported Thursday (Sept. 7), the ban would apply to sensitive departments of state-owned companies and government agencies, which have begun telling staff not to bring the devices to work, per sources familiar with the matter.

The report adds that the Chinese government plans to extend the ban to an array of state-owned businesses and government agencies. PYMNTS has contacted Apple for comment but has not yet gotten a reply.

Sources tell Bloomberg it’s not clear how many businesses and agencies would adopt the restrictions, as there has been no formal pronouncement. The report uses the example of PetroChina, an oil company owned by the state and employing millions of people.

However, the ban would be unprecedented, the Bloomberg report contends, threatening a market that provides Apple with roughly 20% of its revenue (and in a country where most of the world’s iPhones are made). As PYMNTS noted last month, Apple saw sales of $15.8 billion in the greater China region during its most recent quarter, up 7.9%.

However, this year has seen Apple look beyond China. PYMNTS reported in March that Foxconn, the company’s chief iPhone supplier, was increasing investments outside the country due to waning consumer demand for electronics.

“We maintain a relatively conservative view towards the smart consumer electronics and think they might decline slightly,” Liu Young-Way, the company’s chairman, said on an earnings call.

While 70% of Foxconn’s revenue comes from products it manufactures in China, the company said it was planning to up its overseas operations. Apple has also recently increased its focus on India as sales in that country climb.

The news comes a little less than a month after U.S. President Joe Biden issued an executive order authorizing the Treasury Department  to prohibit or restrict American investments in Chinese semiconductors and microelectronics, quantum information technologies, as well as certain artificial intelligence systems.

China was disappointed in the move, with a spokesperson for the country’s embassy in Washington saying the restrictions “would seriously undermine the interests of Chinese and American companies and investors. China will closely follow the situation and firmly safeguard our rights and interests.”

As noted here, the order is designed to prevent American capital and expertise from contributing to the development of technologies used by China to modernize its military, which the U.S. argues could hinder national security.