China RFID Activities and Conformity Assessment

Avoid some distinctly Chinese obstacles when developing products for today�s fast-growing Eastern market.

For most Western companies, China�s exciting market opportunities are tempered by the country�s mystery and political intrigue. If you are contemplating obtaining approvals for electrical and electronics products for telecommunications, computing, radio, electronics, or household appliances, then you will face some distinctly Chinese obstacles for which you need to be prepared.

There are several barriers to importing products, such as distance, language, unfamiliar culture, and unsophisticated commercial market conditions, which sometimes add difficulty and expense. Nevertheless, being a relatively new country to IT technology, China represents a huge potential market.

Figure 1. China RFID National Standards Administration

Recently, it has been noted that China no longer is content with just being the world�s pre-eminent manufacturer since it is increasingly active in the development of global technology standards. According to the report Changing China: Will China�s Technology Standards Reshape Your Industry? from Deloitte and Touche, the country�s technology standards initiatives will shape global competition in the TMT sector for years to come.

In a discussion about China�s standards revolution, Clarence Kwan, national managing partner of the Chinese Services Group for the TMT practice at Deloitte & Touche LLP in the United States, warned technology vendors not to underestimate the country�s impact. With the lure of its massive markets and growth, China has leverage in the standards war.

While global collaboration is the optimum solution, Mr. Kwan advised technology companies around the world to carefully monitor China�s actions, assess the implications of Chinese standards, and amend their strategies accordingly. Companies that don�t could one day find themselves locked out of the world�s largest and fastest growing marketplace.

As an example of such activity, China established a WG to draft and develop national standards for RFID tag technology. Some reports indicate the group is adhering to international standards while others suggest the group is planning to go its own way. An incompatible RFID standard could pit the interests of China�s emerging IT industries against the interests of major purchasers of Chinese products.

RFID Activities in China
RFID is a generic term for technologies that use radio waves to automatically identify people or objects. There are several methods of identification, but the most common is to store a serial number that identifies a person or object and perhaps other information on a microchip attached to an antenna.

The chip and antenna combination is called an RFID transponder or an RFID tag. The antenna enables the chip to transmit identification information to a reader, which converts the radio waves reflected back from the RFID tag into digital information.

Currently, RFID has two major technical standards camps: the Massachusetts Institute of Technology Auto-ID Center and Japan�s UID Center. The former leadership organization is EPCglobal with more than 100 European and American retailer enterprises and companies like IBM, Microsoft, Phillips, and Auto-ID Lab providing the engineering research support. The Auto-ID Lab is mainly supported by more than 352 Japanese electronics merchants, information enterprises, and printing companies.

The UID and EPC standards have many differences including the wireless frequency band, the information format, and the applications they address. Because the two big camps are supported by different merchants, the standard eventually adopted will affect each merchant�s market share.

While Japan UID is quite unified, the European and American camp is not. In April 2004, Phillips, Texas Instruments, and another 11 merchants jointly proposed a new RFID standard to EPCglobal. The difficulties associated with coordinating the benefits to each large merchant and making the compromises necessary to support an internationally unified technology standard definitely are much more complicated than the solutions to technical problems.

China�s Role in RFID
Chinese standards normally are proposed by various standards research institutes from nationwide or local governments or industries. Once a proposal is submitted to the national SAC, the committee will review it and, if necessary, organize a standards WG to officially draft the standard. All national standards are managed by a respective ministry, such as the MII and MPI.

Chinese standards start with letters of the Chinese Han Yu Pin Yin such as GB, JB, and YD. There are various levels of Chinese standards; for example, GB standards typically are national legal standards.

Each type of industry has its own industrial standards such as YD standards, which are telecom industrial standards. It is important to know that not only GB but also industrial standards can be included or referenced in the Chinese legal system for product conformity assessment.

To minimize the likelihood that unnecessary national standards are used as nontariff trade barriers, China is under pressure from WTO members to streamline its national standards. With its entry to WTO, China identified the need to increase the level of harmonization of its national standards with those of the international community. However, the whole process to revise the system and its national standards will take time.

One of the major issues is language. Less than 1% of Chinese standards have English revisions; however, the relation of these standards to international standards is much higher, especially in the area of electronics. Overall, China adopts 48% of the international standards. In the electronics field, more than 90% of the Chinese standards are based on international standards.

Figure 1 positions the China RFID National Standards WG relative to related standards organizations. The following timeline lists major Chinese standardization activities during the last few years.

� 2000: SEMC decided to promote its own software encryption standard. This battle ended in a compromise between foreign companies led by Microsoft and the Chinese government.

� 2001: China has its own globally approved standard for 3G and, as the world�s largest market for mobile communications, is well positioned to take a lead role in defining the 4G standard.

� 2002: China implemented the CCC Mark Certification with three months delay after a one-year grace period. Of the requirements, 90% are based on Chinese standards, particularly for nonelectric products.

� 2003: China announced GB Standards for Wireless LAN and tried to enforce WAPI as per Chinese GB standards. Trading-partner objections have delayed WAPI enforcement.

China is developing its own technology for compressing audio and video. AVS is competing with MPEG-4 and H.264 to replace MPEG-2, the current worldwide compression standard.

Chinese companies are trying to promote a successor to the DVD optical disk standard, called EVD, which has better sound and picture quality than DVD. This effort is constrained by the large DVD royalties collected by a consortium of China�s leading makers of DVD players that holds the EVD patents.

� 2004: China recently announced a major commitment to Linux and is drafting a new standard for the Chinese market that might be made compulsory for all IT vendors and service providers.

In spite of these activities, it still is too early to say if China RFID will follow international standards.

RFID Frequency Allocations
Recent support for the 434-MHz radio-frequency band by the FCC and SRRC is a major milestone in advancing a global standard for real-time supply-chain management and security using active RFID technologies. According to FCC Chairman Michael K. Powell, this technology could improve inventory control, lower costs, and increase homeland security. Today�s Third Report and Order allows a new technology to help secure U.S. ports while increasing productivity. With a trillion dollars worth of goods passing through our ports annually, the potential economic benefits of this technology are clear.

In April 2004, FCC 94-98 supported longer time periods for transmission of data over low-band radio frequencies to track shipments at intermodal facilities such as ports, railheads, and truck terminals. Specifically, the FCC ruling increases the transmission period for RFID systems operating in the 433.5 to 434.5-MHz band to ensure that more reliable and greater volumes of data can be transferred, which aligns the United States more with European and other global standards.

In May 2004, a delegation with MII and CAS and led by Madam WU Yi, vice premier minister of China, visited Washington, D.C. RFID was one of the major issues on the agenda. In early June 2004, SRRC, the regulator under MII, issued a public decision to regulate devices operating within 314 to 316 MHz, 430 to 434.92 MHz, 787 to 797 MHz, and 868 to 868.9 MHz.

SRRC implementation matches the EU radio regulations. Countries throughout Asia, North and South America, and Africa permit usage of the 433.92-MHz radio frequency band. This band already has achieved a type of de facto standard status.

In addition, the ISO is expected to ratify 18000-7, which will provide a stand-ard for active RFID technology using 433.92 MHz. The frequency also is one of the options in the draft international standard for RTLS for tracking assets in more confined environments. Table 1 lists the frequencies that currently can be used for RFID in China.

The RFID WG is drafting Chinese National RFID Standards, and frequency bands of 433 MHz and 915 MHz currently are under experiment for EMI. SRRC shall announce its final decision within the next few months.

RFID Regulatory Requirements
All RFID products basically are radio devices that must have radio type approval from SRRC. The MII regulated both telecommunications and radio communications equipment; however, initially there were two organizations under MII to accept radio type approval applications: the TAB Certification Center and the SRRC Certification Center.

Currently, the TAB Certification Center only accepts NAL applications, and the SRRC takes charge of radio type approvals. The process of radio type approval is similar to that of NAL and free of charge by SRRC, but in-country testing is mandatory. The cost of testing is determined by SRRC and charged by the test labs.

The following documents are required for testing and radio type approval. All documents must be submitted in Chinese or another language with Chinese translation.

�Application form
�Business license of applicant
�Power of attorney
�Manufacturer�s or factory�s quality system documentation
�Brief description of both the manufacturer and the local representative
�Description of the equipment, functionality, performance, and
�Detailed post-sales support program and commitment
�User�s manual and installation instructions
�A minimum of five interior and exterior photos of the equipment
�Block diagrams, circuit diagrams, and assembly diagrams of the
�Any approvals obtained from other countries

There are four major steps when obtaining China SRRC radio type approval on RFID devices: documents and submittal, in-country product testing, review and approval, and product labeling.

There are multiple certification systems in China. Other agency approvals, such as CCC Mark Certification, GA Mark Certification (formerly the Security Products Sales Permit), and Intentional Radiator�s Importation Permit, may be required in addition to SRRC approval.

China�s government fully realizes that high-tech is the future of China. China has been actively developing its own technologies and standards in various technology areas. RFID is not an exception, especially with Wal-Mart�s mandate of implementation of RFID by its top 100 suppliers by January 2005 and individual goods by January 2006.

However, because 70% of Wal-Mart suppliers are in China, when the China RFID WG is drafting the Chinese national RFID standards, it must consider how best to assist Chinese domestic merchants in satisfying the new demand of the Western customers.

According to Wang Zhongmin, the assistant commissioner of CAS responsible for China RFID standards, China will be actively involved in the formation of RFID standards in the EPCglobal. This at least demonstrates that China is willing to work with the world to have an international standard for RFID.

About the Author
Leslie Bai is director of certification for and a founder of SIEMIC in Silicon Valley and SIEMIC Certification Services in Beiging, China. He has more than 15 years of experience in global regulatory compliance. SIEMIC, 43038 Christy St., Fremont, CA 94538, 510-657-5989, e-mail: [email protected]

December 2004

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