Overview

• China's National Press and Publication Administration has proposed new regulations aimed at curbing spending and time on video games, causing a significant drop in shares for major gaming companies Tencent and NetEase.
• The proposed rules include banning online games from offering rewards for daily logins, first-time spending, or consecutive purchases, and requiring games to set limits on how much players can top up their digital wallets for in-game spending.
• Regulators will also be required to process game approvals within 60 days, and games must store their servers within China's borders.
• The draft regulations have sparked a debate among investors and industry analysts about the potential impact on revenue or user engagement.
• The public can provide comment on these new rules until January 22, 2024.