China proposes new ad rules; Tightens scrutiny over tech firms

By Amirtha P S, Desk Reporter
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The Chinese market regulator has introduced new rules that would tighten the online advertising oversight, which includes demanding that adverts should not affect normal internet use or mislead users.

This year, the authorities in China have put forward strict regulations across a range of industries, especially targeting the technology sector. During the recent quarterly results the search giant Baidu and game publisher Tencent Holdings stressed that their short-term outlook for advertising sales looked weak, mainly due to the COVID-19 pandemic and the Chinese authority’s regulatory crackdown.

Internet advertising must “meet the requirements for the establishment of socialist spiritual civilization and the promotion of an excellent traditional culture of the Chinese nation”, the State Administration for Market Regulation said.

The proposed rules require platform operators to set up a system for registering and reviewing advertisers and adverts as well as monitor and inspect the content of advertisements displayed and published by using its information services.

Further, it calls for bans on advertisements that are targeted at minors promoting medical treatments, cosmetics and online games, which are not conducive to the physical and mental health of minors.

The proposed new rules are open for public comment until December 25, the regulator said. After the draft rules were published, Shares in Hong Kong-listed Tencent and delivery giant Meituan fell 0.5 percent and 1 percent respectively.

In September, China’s cyberspace regulator published draft rules dictating how companies can use algorithmic recommendations, after earlier rules pertaining to the use of data and unfair competition.

Earlier this year, Chinese ride-hailing giant Didi Chuxing fell subject to investigation for alleged privacy violations days after it was listed in the US, while eCommerce giant Alibaba Group received a record $2.8 billion fine for anti-competitive behavior.

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