Daily Management Review

China prepares new restrictions for IT sector


The State Administration of Market Regulation of the People's Republic of China has drafted new rules for antitrust regulation of the technology sector. It provides for further tightening of regulations for IT companies.

The watchdog will collect public feedback on the bill until September 15, after which the document may be amended. However, investors in Chinese technology companies have already reacted to the increased pressure from the authorities and quotes of IT-companies are markedly declining. 

Among the rules spelled out in the bill are a ban on providing false data on the number of clicks on a particular site, a ban on publishing only positive reviews and hiding negative ones, a ban on traffic hijacking - redirecting to their site while the user is browsing the site of another company, a ban on using algorithms and databases to collect and analyze information about competitors' trading activities.

Many analysts consider the investigation of Jack Ma, the founder of the Internet giant Alibaba, which began late last year as the first wave of pressure on the technology business by the Chinese authorities. As a result of the investigation, Alibaba was fined $2.8 billion for "abuse of a dominant position". A new round of pressure on China's high-tech began in June, when the State Administration for Market Regulation launched an investigation into the local online cab ordering service Didi Chuxing.

source: reuters.com