Regional spotlight: Digital product passports & traceability in China — what's different and why it matters

China processed over 56 million tonnes of recyclable materials through regulated channels in 2024, yet fewer than 8% of consumer products sold domestically carried any form of standardized digital traceability identifier (China National Resources Recycling Association, 2025). That gap between material throughput and data transparency defines the central challenge for digital product passports (DPPs) in the world's largest manufacturing economy. For founders building traceability solutions, China represents a market where state-led digital infrastructure, unique regulatory architecture, and unmatched manufacturing scale create an operating environment that shares almost nothing with the EU's Digital Product Passport framework beyond the name.

Why It Matters

China's approach to product traceability diverges from the European model in structural ways that reshape technology requirements, business models, and competitive dynamics. The EU's Digital Product Passport regulation (ESPR, adopted 2024) mandates standardized data carriers and interoperable data models across 30+ product categories starting in 2027. China has no equivalent horizontal DPP mandate. Instead, traceability requirements emerge from a patchwork of sector-specific regulations, food safety laws, industrial policy directives, and platform-driven commercial incentives that together create a fragmented but fast-moving landscape.

China's manufacturing base produces approximately 30% of global manufactured goods by value, and its export-oriented industries face growing external pressure to provide product-level sustainability data. The EU's Carbon Border Adjustment Mechanism (CBAM), which entered its transitional phase in 2023, requires embedded emissions data for imported steel, aluminum, cement, fertilizers, electricity, and hydrogen. The ESPR's DPP requirements will extend product data obligations to batteries (from 2027), textiles, electronics, and construction materials. Chinese manufacturers supplying European markets must build traceability infrastructure regardless of domestic policy, creating a dual-track compliance environment where export-facing and domestic-facing systems often operate independently.

The domestic market is shaped by the government's broader digital economy strategy. China's "New Infrastructure" initiative, launched in 2020 and expanded through the 14th Five-Year Plan (2021 to 2025), has invested over RMB 10 trillion ($1.4 trillion) in 5G networks, data centers, industrial internet platforms, and AI infrastructure. This digital backbone provides capabilities that European and North American traceability systems cannot assume: near-universal QR code adoption, integrated mobile payment ecosystems that link product identity to transaction data, and government-operated platforms for cross-referencing product registrations against customs, tax, and quality inspection records.

Key Concepts

China's Traceability Regulatory Architecture

China's product traceability requirements are driven primarily by sector-specific mandates rather than a unified DPP framework. The most mature system is in food safety. The Food Safety Law (revised 2021) and its implementing regulations require all food producers, processors, and distributors to maintain electronic traceability records covering raw material sourcing, production processes, quality testing, and distribution. The State Administration for Market Regulation (SAMR) operates the National Food Safety Traceability Platform, which aggregates data from over 1.2 million registered food businesses and processes approximately 15 billion traceability queries per year (SAMR, 2025).

Pharmaceutical traceability operates under the Drug Administration Law (revised 2019), which mandates serialization and track-and-trace for all prescription drugs through the National Drug Traceability Collaborative Platform. Each drug package carries a unique identification code linked to manufacturer, batch, and distribution data. The system achieved 98% coverage of prescription drugs by volume in 2024, processing over 30 billion serialized units (National Medical Products Administration, 2025).

For industrial products, traceability requirements are emerging through the "dual carbon" policy framework (peak emissions before 2030, carbon neutrality by 2060). The Ministry of Industry and Information Technology (MIIT) issued guidelines in 2024 for carbon footprint labeling of key industrial products, starting with steel, aluminum, cement, lithium-ion batteries, and photovoltaic modules. These guidelines establish data collection methodologies and reporting formats but stop short of mandating digital product passports comparable to the EU model.

State-Platform Integration

A defining feature of China's traceability landscape is the integration between government platforms and commercial ecosystems. Unlike the EU's approach, which envisions decentralized, interoperable DPP systems accessed through standardized data carriers, China's model relies heavily on centralized platforms operated by government agencies or state-affiliated entities.

The China National Industrial Internet Identification Resolution System, overseen by MIIT, provides a universal product identification infrastructure. As of 2025, the system has registered over 380 billion industrial identifiers across 40+ industry verticals, with daily resolution queries exceeding 300 million (MIIT, 2025). This system functions as a national-scale product identity layer that companies can integrate with their own traceability systems, creating a hybrid architecture where product identity is centrally managed but product data can be stored across distributed enterprise systems.

Commercial platforms add another layer. Alibaba's Ant Group operates a blockchain-based traceability platform (AntChain) that covers cross-border trade documentation, luxury goods authentication, and agricultural product provenance. JD.com's supply chain platform provides end-to-end traceability for over 800 product categories using a combination of IoT sensors, blockchain records, and AI-powered quality inspection. These platforms process traceability data at scales that dwarf any European DPP pilot: JD.com's system alone tracked over 6 billion product units in 2024 (JD Technology, 2025).

Export Compliance and Dual-Track Systems

Chinese manufacturers exporting to the EU face a specific challenge: building traceability systems that satisfy European DPP requirements while operating within China's data governance framework. The Data Security Law (2021), Personal Information Protection Law (2021), and Cybersecurity Law (2017) collectively restrict cross-border data transfers and require security assessments for data deemed "important" or involving critical information infrastructure.

For traceability data, this creates tension. EU DPP regulations require product data to be accessible to European regulators, market surveillance authorities, and in some cases consumers. Chinese data localization requirements may restrict the direct transfer of manufacturing process data, supplier identities, or quality inspection records to EU-hosted systems. Companies navigating this dual-track environment typically deploy separate data architectures: a domestic system compliant with Chinese data governance, and an export-facing system that provides EU-required data elements through controlled access points that satisfy both jurisdictions' requirements.

What's Working

China's food safety traceability infrastructure demonstrates the most mature implementation at scale. After a decade of iterative deployment following the 2008 melamine contamination crisis, the system now covers the entire food supply chain from farm to retail. Walmart China's blockchain-based food traceability system, developed in partnership with VeChain and IBM, reduced the time required to trace mangoes from farm to store from 7 days to 2.2 seconds. The system covers over 100 product lines and has been integrated with SAMR's national platform, establishing a model for public-private traceability collaboration.

In the battery sector, the China Automotive Battery Innovation Alliance (CABIA) launched a battery passport pilot in 2024 covering lithium-ion batteries for electric vehicles. The pilot, involving CATL, BYD, and six other major battery manufacturers, tracks battery chemistry, manufacturing data, state of health metrics, and materials composition across the battery lifecycle. By early 2026, the pilot covered approximately 4 million battery packs, representing roughly 35% of new EV batteries produced in China. The system uses the Industrial Internet Identification Resolution System for unique battery identification and provides data access to recyclers and second-life application providers through APIs.

Textile traceability is advancing through commercial pressure from export markets. Shenzhou International, the world's largest knitwear manufacturer (supplying Nike, Adidas, and Uniqlo), has implemented facility-level carbon tracking across its 11 Chinese production sites. The system measures energy consumption, water usage, chemical inputs, and waste generation per production batch, generating product-level environmental data that satisfies the requirements of the EU's proposed Ecodesign for Sustainable Products Regulation. Shenzhou's system processes traceability data for approximately 2 billion garment units per year.

The rare earth minerals sector provides another success case. The Ministry of Natural Resources mandates full supply chain traceability for rare earth mining, processing, and export through the Rare Earth Product Traceability Information System. Every kilogram of rare earth material produced in China carries a digital traceability tag linking it to the specific mine, processing facility, and export documentation. The system was implemented to combat illegal mining and export but now serves as a de facto product passport for a strategically critical material category.

What's Not Working

Interoperability remains the most significant barrier. China's traceability systems were built independently across sectors and platforms, resulting in dozens of incompatible data standards, identifier formats, and access protocols. A steel manufacturer that traces its products through MIIT's industrial identification system cannot seamlessly link that data to the environmental monitoring data held by the Ministry of Ecology and Environment or the customs documentation managed by the General Administration of Customs. Each system requires separate registration, separate data formatting, and often separate technical integration.

Data quality at the supplier level presents persistent challenges, particularly in fragmented industries. While large manufacturers can invest in automated data collection systems, small and medium enterprises (SMEs) that make up the lower tiers of supply chains often rely on manual data entry with minimal verification. A 2025 survey by the China Federation of Logistics and Purchasing found that only 22% of tier-3 and tier-4 suppliers in the electronics sector could provide batch-level traceability data in digital format, compared to 87% of tier-1 suppliers.

Cross-border data sharing remains legally and technically complex. Companies attempting to provide EU DPP-compliant data while respecting Chinese data governance face compliance costs estimated at $200,000 to $800,000 per product category for initial system architecture, plus ongoing operational costs of $50,000 to $150,000 annually per category (McKinsey China, 2025). These costs disproportionately burden smaller exporters.

Consumer engagement with product traceability data is lower than platform operators anticipated. Despite near-universal QR code scanning capability among Chinese consumers, scan rates for traceability information (as opposed to payment or promotional content) average 2 to 5% of eligible transactions for food products and below 1% for non-food categories. This low engagement undermines the business case for consumer-facing traceability features and shifts investment toward B2B and regulatory compliance use cases.

Key Players

Established companies: CATL (battery passport pilot, lifecycle tracking for EV batteries), BYD (integrated battery and vehicle traceability systems), Alibaba/Ant Group (AntChain blockchain traceability platform for cross-border trade and agriculture), JD.com (supply chain traceability covering 800+ product categories), Shenzhou International (textile traceability for global brands), Huawei (industrial IoT and identification infrastructure)

Startups and technology providers: VeChain (blockchain-based supply chain traceability with enterprise clients in food, luxury, and automotive), Wanxiang Blockchain (industrial traceability and carbon accounting platforms), Conflux Network (public blockchain infrastructure for product authentication), OneConnect (Ping An subsidiary providing supply chain finance and traceability solutions), Zhongchao Blockchain (government-contracted traceability platform development)

Investors and policy bodies: Ministry of Industry and Information Technology (industrial identification system, carbon footprint labeling guidelines), State Administration for Market Regulation (food safety traceability platform), China Academy of Information and Communications Technology (CAICT, standards development for industrial internet identifiers), Asian Development Bank (technical assistance for cross-border traceability interoperability), Green Digital Finance Alliance (blockchain for sustainable supply chain initiatives)

Action Checklist

• Map your product categories against both Chinese domestic traceability requirements and EU DPP obligations to identify overlap and gaps in data collection
• Register with the China National Industrial Internet Identification Resolution System to obtain standardized product identifiers compatible with domestic infrastructure
• Design data architecture that satisfies Chinese data localization requirements while enabling controlled export of EU-required product data elements
• Prioritize integration with existing commercial platforms (AntChain, JD supply chain) rather than building standalone systems to reduce customer acquisition costs
• Engage with MIIT's carbon footprint labeling program for steel, aluminum, batteries, and photovoltaics to align product data models with emerging domestic requirements
• Build supplier data quality programs targeting tier-2 and tier-3 suppliers with digital data collection tools and training
• Monitor the EU-China Green Partnership developments for potential mutual recognition frameworks that could simplify dual-track compliance
• Evaluate the battery passport pilot (CABIA) as a template for DPP implementation patterns that work within China's regulatory and data governance framework

FAQ

Q: How does China's approach to digital product passports differ from the EU's? A: The EU is building a unified, horizontal DPP framework (under the ESPR) that mandates standardized data carriers and interoperable data models across dozens of product categories. China has no equivalent horizontal mandate. Instead, traceability requirements emerge sector by sector through food safety law, pharmaceutical serialization, battery lifecycle tracking, and industrial carbon footprint labeling. China's systems are also more centralized, relying on government-operated platforms and national identification infrastructure, whereas the EU envisions decentralized, interoperable systems. For companies operating in both markets, this means maintaining fundamentally different compliance architectures rather than adapting a single system.

Q: Can Chinese traceability data be shared with EU regulators? A: In principle, yes, but with significant legal and technical constraints. China's Data Security Law requires security assessments for cross-border transfers of data classified as "important," and the Cyberspace Administration of China has broad discretion over what data falls into this category. Manufacturing process data, supplier network information, and quality testing results may trigger review requirements. Companies typically address this by creating controlled data export pathways that share product-level summary data (compliant with EU DPP schemas) without transferring raw operational data. Legal costs for establishing compliant cross-border data architectures range from $100,000 to $300,000 for initial setup.

Q: What technology stack works best for traceability in China? A: Successful implementations typically combine the national Industrial Internet Identification Resolution System for product identity, enterprise resource planning (ERP) integration for manufacturing data capture, QR codes as the primary consumer and B2B data carrier (RFID adoption remains limited outside logistics and high-value goods), and either blockchain (for cross-border and high-trust applications) or centralized databases (for domestic compliance) for data storage. Mobile-first interfaces are essential given that over 95% of Chinese internet access occurs via mobile devices. Cloud infrastructure should be hosted within China (Alibaba Cloud, Tencent Cloud, or Huawei Cloud) to comply with data localization requirements.

Q: Which product categories will face DPP requirements first in China? A: Batteries are the most advanced, with the CABIA pilot already covering 35% of new EV battery production. Steel and aluminum are next, driven by MIIT's carbon footprint labeling guidelines and the need to provide embedded emissions data for EU CBAM compliance. Photovoltaic modules follow closely, as Chinese manufacturers (who produce over 80% of global solar panels) face both EU traceability requirements and US forced labor import restrictions that require supply chain documentation. Textiles and electronics will see requirements emerge more gradually, likely starting with export-facing compliance before domestic mandates develop.

Q: Is blockchain necessary for product traceability in China? A: Not for domestic compliance, where centralized government platforms are the primary infrastructure. Blockchain adds value in specific contexts: cross-border trade documentation (where multiple parties need shared, tamper-evident records), luxury goods authentication (where counterfeiting risk is high), and voluntary sustainability claims (where third-party verification is commercially valuable). VeChain's enterprise deployments demonstrate that permissioned blockchain can operate at commercial scale within China's regulatory framework, but most domestic traceability implementations function effectively with conventional database architectures integrated into government platforms.

Sources

• China National Resources Recycling Association. (2025). Annual Report on China's Renewable Resources Recovery Industry 2024. Beijing: CNRRA.
• State Administration for Market Regulation. (2025). National Food Safety Traceability Platform: Annual Operations Report 2024. Beijing: SAMR.
• National Medical Products Administration. (2025). Drug Traceability System Implementation Progress Report. Beijing: NMPA.
• Ministry of Industry and Information Technology. (2025). Industrial Internet Identification Resolution System: Development Status and Outlook. Beijing: MIIT.
• JD Technology. (2025). JD Supply Chain Traceability Platform: 2024 Annual Data Report. Beijing: JD Technology.
• McKinsey China. (2025). Navigating Dual-Track Compliance: Product Traceability for Chinese Exporters. Shanghai: McKinsey & Company.
• China Academy of Information and Communications Technology. (2025). White Paper on Digital Product Passports: International Comparison and China Pathway. Beijing: CAICT.