If this ever came to pass then how would it not be by-passed in seconds? If anything I would expect the CCP to give them the bird by making everyone appear to be in Dardanelle, Arkansas. the senators home town, pop. 4500
It is technically possible to make this solid. Much in the same way that you can make a piece of client side software next to impossible to pirate by having it in part run on a central server.
The more I think about this I would wager it has nothing to do with China at all. More likely some people are upset that people can avoid tracking with software and so this will be in the hardware to bypass the blocking of tracking.
How is this even technically possible? On chip GPS? Or I guess some sort of key validation that requires a knob connected to GPS? Anyways, once China can make its own fast chips economically, we won't hear this non-sense anymore.