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China – From Education to E-Commerce and Bitcoin: How China’s Regulators Take Tackle




The National Radio and Television Authority (NRTA) in China recently ordered broadcasters to exclude artists with “incorrect political positions” from programs and to cultivate a “patriotic atmosphere”.

The move is part of a series of measures that authorities are using to tighten their oversight of many industries – from technology to education. This is intended to strengthen control over the economy and society after years of rapid growth.

The following is a list of sectors that are already subject to stricter rules or that could be targeted by Chinese supervisors:

Gaming industry

The authorities restricted the time that under 18-year-olds are allowed to spend online games – to one hour every Friday and on weekends and holidays.

In this way, the supervisors responded to growing concerns that more and more young people could develop a gambling addiction. So far, minors have been allowed to play 1.5 hours a day and three hours on holidays.

Specifically, minors should only be allowed to play online between 8 p.m. and 9 p.m. local time. At all other times, companies should be prohibited from offering games. Corresponding reviews would be intensified.

In August, for example, a report by a Chinese state media that referred to online games as “spiritual opium” caused unrest.

This caused the market value of the industry giant Tencent to collapse by 60 billion dollars. Tencent responded with restrictions on minors playing the popular Honor of Kings game and promised measures to ensure that children spend less time playing video games.

Online finance

In the fall of last year, China’s authorities thwarted the planned IPO of the fintech group Ant Group and thus also burdened the parent company Alibaba.

Just two days before the planned debut on the stock exchanges in Shanghai and Hong Kong, the financial supervisory authority criticized Alibaba founder Jack Ma for the fact that the disclosure requirements would not be met due to changed regulations.

Shortly before the finish line, China’s industry leader in mobile payments, the world’s largest IPO with more than $ 37 billion, failed. At the same time, the banking supervisors presented rules for stricter control of the issuing of online loans.

Online trade

Traditional online trading is a particular focus of Chinese regulators. Amazon rival Alibaba was fined a record $ 2.75 billion in April.

Smaller platforms were also fined for violating consumer rights. The latest move by the regulatory authority stipulates that companies are not allowed to use data or algorithms to direct data traffic or influence user decisions.

The agency also has its sights set on marketing campaigns aimed at fake reviews or ratings.




show business

The entertainment industry has also been targeted. Broadcasters were instructed to exclude artists with “incorrect political positions” from programs.

A “patriotic atmosphere” must be cultivated, as the National Radio and Television Authority (NRTA) explained. The regulation of cultural programs will be tightened. Action is taken against content that is perceived as unhealthy as well as against high salaries of the stars and tax evasion.

education

The government decided in July that companies from the education sector that offer tuition in the core school subjects will no longer be allowed to make profits in future and justified this with financial relief for families.

This caused the courses of affected listed education providers such as Gaotu, TAL Education and New Oriental Education to collapse by up to 70 percent at times.

Driving services

Only days after the listing in New York, the Chinese Internet regulator CAC prohibited domestic Uber rival Didi from acquiring new customers in China, which caused the price of the transport operator to collapse by around a fifth.

At the same time, the supervisors blocked the Didi app for downloading. Serious violations in the collection and use of personal data were given as reasons.

Analysts and investors saw the measures more in connection with the criticism of foreign quotations by Chinese companies and the collection of large amounts of data.

Bitcoin & Co have long been a thorn in the side of the leadership in Beijing. In May, financial regulators extended restrictions on cryptocurrencies by banning their use for payments or billing by banks and online businesses.

In the course of the summer, the authorities also ordered the closure of server farms, which are known in technical jargon as “prospectors” or “miners”, thereby sending Bitcoin on a downward slide. So far, around half of the new Bitcoin worldwide had been mined in China.

Real estate market

The government and regulators targeted the real estate sector in July, which wiped out around a tenth of the CSI 300 Real Estate sub-index. Authorities restricted real estate borrowing and set caps for real estate developers and banks. This was said to be the reason for preventing a real estate bubble.

The government also wants to create more affordable housing with a rent brake. The cost of renting an apartment in cities may in future rise by a maximum of five percent per year.

“New townspeople and young people have been working for a relatively short time and have low incomes, making it difficult for them to buy a house or pay rent,” said Deputy Housing Minister Ni Hong.

What’s next?

After the State Council called for lower drug prices and reforms in June, investors fear measures in the health sector. Technology companies are also preparing for further restrictions.

Among other things, they are arming themselves against a data security law that prescribes risk assessments and reports to authorities. A planned law that regulates the storage of user data will also leave traces.

The cuts that President Xi Jinping is aiming for for the super-rich in China is also putting luxury stocks under pressure.

(Reuters)


Hasan Sheikh
Hasan, who loves technology and games, is studying Computer Engineering at Delhi JNU. He has been writing technology news since 2016.
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