China proposes new rules on online video games, curbs minors from tipping live steamers

Beijing [China]: The Chinese regulators announced some new restrictions on online video games aimed at tightening the management of the industry and protecting the country’s minors, The New York Times reported on Friday.

The new rules are the latest in a line of restrictions to curb how children interact with gaming and live-streaming platforms in China. Last year, children under 16 were banned from registering to livestream themselves.

The proposed rules, which are subject to public comment before being made final and the plan would call for users to have spending limits on the game platforms and would prohibit minors from tipping videogame live streamers.

The draft rules, issued by the National Press and Publication Administration, would also try to lessen the incentives for players to keep coming back by banning game companies from offering rewards for daily logins.

Additionally, the rules would require computer servers and other equipment used by game companies to be located within China and would stipulate that the content of games must not contain state secrets or endanger national security, The New York Times reported.

As early as 2019, the Chinese authorities aimed what they deemed was a problem of online game addiction among minors, setting daily time limits on gamers under 18. Those restrictions have since been tightened. Four months ago, regulators proposed rules that would require a “minor mode” on mobile devices to cap screen time and restrict the content for schoolchildren.

The government has waged a wider war on the tech industry in the last few years, seeking to rein in e-commerce, financial technology and ride-hailing businesses that it decided had become too powerful. As a result, companies that were once as large as their US counterparts collectively lost trillions of dollars in market value.

Regulators stymied online gaming by delaying for eight months the issuance of licenses publishers need to bring out new games, finally ending the suspension in April 2022.

As per The New York Times report which cited Research by Goldman Sachs, an investment bank, China’s online game industry tops the world in both the number of users, 650 million last year, as well as revenue, $45 billion.

The announcement of the proposed rules sent the share prices of Chinese videogame companies tumbling: Tencent fell about 12 per cent, and Netease plunged 25 per cent.

On Weibo, China’s social media platform, one commenter criticized the proposal as counterproductive when the Chinese economy is struggling: “Now you know who is suppressing the Chinese economy, right?”

The National Press and Publication Administration will accept public and industry feedback on the rules through Jan. 22. The proposal could then be amended before it takes effect.