Chinese authorities have put up an internet video games ethics committee which has reviewed 20 names, state media said, raising hopes that the government was preparing to restart an approval process that’s been suspended for the majority of this past year.
China, the world’s largest gambling market, ceased approving new names from March amid a regulatory overhaul triggered by increasing criticism of video games because of its violent and contributing to myopia in addition to dependence among young consumers.
The freeze on new approvals has driven gaming-related stocks and clouded the outlook for mobile games, together with business leader Tencent Holdings reporting its first profit decline in more than a decade at the June quarter.
However, in a signal an end to the regulatory instability might be close, say media Xinhua reported on Friday the brand new games ethics committee – under the guidance of Chinese Communist Party propaganda section – had reviewed 20 games.
It’s asked for a set of 11 names to”eliminate moral hazard”, and refused the remaining citing unsuitable material, Xinhua added.
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Industry insiders welcomed the move by the committee composed of specialists on games and maternity issues in universities, business associations, research institutions and media outlets.
“We see this as an advanced measure with more strategic instructions inclined to be given from end of this month,” Jefferies said in a research note.
“This could possibly be followed closely by timetable announcement of acceptance resumption prior to mid-2019.”
Tencent declined to comment.
Nevertheless, an executive in the tech giant said on condition of anonymity: “I believe that the sign is, it is nearly the year ending, the revamp ought to return to a conclusion.”
Tencent has dropped over $100 billion in market value since the beginning of the year amid regulatory doubt.
On Monday, the stock was down 1.2 percent, in accordance with the wider economy.