China has reportedly suspended Tencent Holdings from updating existing new apps and launching new ones as a part of a “temporary administrative guidance” from China’s Ministry of Industry and Information Technology (MIIT), according to the South China Morning Post.
The Chinese ministry has let app stores and platform holders implement their orders against Tencent apps effective immediately. Tencent indirectly confirms the report in a statement saying that they are cooperating with the government.
“We are continuously working to enhance user protection features within our apps, and also have regular cooperation with relevant government agencies to ensure regulatory compliance. Our apps remain functional and available for download,” Tencent said in a statement.
The ban is affected dozens of the company’s apps within the country which includes the company’s instant messaging app, WeChat which has accumulated over 1.2 billion users since its 2011 launch.
Following that report, according to the Chinese financial media outlet, Yicai who cites unnamed sources, MIIT is requiring Tencent to submit new apps or updates for inspection. From November 24th through December 31st, any apps and their updates will undergo a seven-day-long review before they can be uploaded to app stores. Tencent adds that its apps will remain functional and available for download.
The reason for MIIT targeting Tencent is that the Chinese government discovered that some of its apps were found to have infringed on users’ rights and interests. Over the past year, Chinese regulators have cracked down on the country’s tech sectors while seeking to dismantle some of the industry’s long-held practices.
Beijing has been increasing its efforts to regulate data in the country. Such steps it has taken include enacting the Cybersecurity Law in 2017 and the Data Security Law this September. The most recent law requires firms to undergo a security assessment in order to gain approval before sending user data overseas. The Chinese government has accused tech giants of their monopolistic behaviour and infringing on user rights.
Tencent appears to be expanding its overseas investment initiative as of late which looks like a way to free itself from China’s strict policies. While Tencent as a company is worth $500 billion, by the end of 2020 that value went down by 20 percent ‘thanks’ to the Chinese government’s tough regulations. Tencent is a 40% minority owner of Epic Games maker of Fortnite, along with the owner of Riot Games, Funcom and Fatshark.