Chinese crackdown on the powerful tech giants continues today as the State Administration for Market Regulation (SAMR) drafted new regulations that aim to tighten rules on unfair competition in the internet sector, restrict the use of user data, and violation of consumer rights.
Established 3 years ago, SAMR was relatively absent from the regulation scene until the end of 2020, when it started a campaign that resulted in hefty fines to big tech firms like Alibaba Group Holding and Tencent Holdings.
China’s top market regulator has decided to tighten its grip on the internet platforms to limit its power. According to CNBC, Internet operators in China must Hcomply with the following new rules:
- Not provide false data, such as the number of clicks on a piece of content.
- Operators should not conceal negative reviews and only promote positive reviews.
- Internet platforms should not use data, algorithms, and other technical means to influence user choices or other methods to carry out so-called traffic hijacking. This is where a company looks to redirect a user to their own website or service while they’re browsing another.
- Operators should not use data and algorithms to collect and analyze competitors’ trading information.
As soon as the news broke, Hong Kong-listed Internet stocks slipped, Tencent's fell 4.45%, Alibaba's dropped (GMT+3)
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