The Chinese government has banned state-backed blockchain firm, Tus Data Asset, from exporting medical supplies to countries dealing with the COVID-19 pandemic.

According to the local newspaper The Global Times, the Beijing-based company was blacklisted on April 15 by the Ministry of Commerce because they “distorted” the nation’s image by selling poor-quality products. They additionally apologized for not supervising third-party suppliers more effectively.

It is worth noting that Tus Data Asset is the first blockchain tech firm controlled by state capital.

Low-quality products reportedly returned by overseas clients

The company began exporting medical supply products in late March as COVID-19 driven demands grew. Prior to this, the company was focused on providing blockchain solutions for the Communist Party of China.

The company was blacklisted after overseas buyers decided to return the goods due to their low quality. However, the ministry did not provide additional details on what types of products presented quality problems.

Shenzhen-based Aibaoda Technology, a tech firm dedicated to the selling of earphones and microphones, also appears on China’s ban list. They too were reselling medical masks acquired from local manufacturers.

Speaking to the South China Morning Post, an Aibaoda spokesman said the following:

“We started to export masks not long ago… we were not exporting any medical supplies other than masks. We don’t manufacture masks; we just bought the masks from somewhere else and exported them.”

Companies in Spain stopped to use coronavirus test kits manufactured by Chinese firms

The company had started selling medical supplies in February, thus joining a group of hundreds of Chinese firms dedicated to supply or manufacture medical equipment to international clients.

Spain reported in March that they stopped using rapid COVID-19 test kits made by another Chinese company after discovering that they were not effective.