The Measures for Administration of the Qualification Accreditation of Inspection and Testing Institutions will come into effect as of August 1, according to the news from the recently held 3^rd National Inspection and Testing Institution Qualification Accreditation Working Meeting. Since then the provisions on “foreign investors who set up foreign-funded inspection and testing institutions in China should have at least three of inspection and testing experiences” will be canceled. This move reveals that China implements the national treatment to the foreign investors and encourages fair competition, say analysts. 

 

Since 2002, China has opened the technical inspection sector to the foreign investors. Large international testing institutions have started the testing services in China by making investment or establishing branches in China. Currently they have completed their industrial layout plans, imposing high competitive pressures to domestic institutions.

 

The data show that of the inspection and testing institutions above the statistics threshold, 14,509 state-owned or state-holding institutions realized an operating revenue of RMB76.082 billion last year, up 9.89% year-on-year. The 143 enterprises funded by investors from Hong Kong, Macao, Taiwan and foreign investors realized an operating revenue of RMB9.677 billion, up 38.03% year-on-year. The growth rate of the operating revenue of the foreign-funded inspection and testing institutions is three times of that of the state-owned and state-holding institutions. If sharing out equally, each foreign-funded inspection and testing institution has an operating revenue of more than RMB70 million, 12 times of the market average. That means the foreign-funded inspection and testing institutions, less than 0.5% of the total number of the inspection and testing institutions (28,340), contributed to 6.23% of the total operating revenue of the sector, showing that their profitability is much higher than the market average.

 

With regard to the market share, 15 of the Top 100 inspection and testing institutions in terms of the operating revenue are foreign funded, an increase of three institutions against that of 2013. These 15 institutions account for 25.2% of the total size of the Top 100 inspection and testing institutions in terms of the operating revenue. Of the Top 50 institutions of the operating revenue, 10 are foreign funded, an increase of three institutions compared with that in 2013. And these 10 institutions account for 30.78% of the total size of the Top 50 inspection and testing institutions. Of the Top 20 inspection and testing institutions of the operating revenue, seven are foreign funded, two institutions more than that in 2012. These seven institutions account for 45.56% of the total size of the Top 20 institutions.

 

According to the analysts, the domestic inspection and testing institutions will face more competitive pressures with the removal of restrictions on the establishment of the foreign-funded inspection and testing institutions. It is suggested that domestic institutions should work hard to explore the market and accelerate development.

 

Source: www.comnews.cn