Chinese government departments battle over lucrative gaming industry
China's General Administration of Press and Publication (GAPP) has hit out against online game providers on the eve of the industry's annual conference sponsored by the Ministry of Culture, in what appears to be a tiff between the two government departments.
On Friday GAPP issued a statement saying that "foreign companies are not allowed to operate online games in China in any form". The Game Developers Conference China opened in Shanghai this morning.
Launching into a war or words between two of the Communist government's major departments, the vice director of Ministry of Culture's Market Department, Tuo Zu Hai, this morning responded saying he was "startled to hear this news".
He added that the statement from GAPP did not follow "in spirit" with guidance from the two departments' over-riding government body, the Establishment Committee of the Central Organization.
Supervisory power of the online gaming industry was taken away from GAPP and given to the Ministry of Culture on September 7th. However the General Administration of Press and Publication still controls the power to issue licences for all commercial websites hosted in China.
GAPP's reiteration over the weekend that foreign companies are not allowed to operate online games in China - a law not enforced strictly while GAPP was supervising - is being seen by analysts an attempt to regain some of its authority over and interest in the fast-growing industry.
"The new rule is a good beginning in approving the online games in accordance with laws and will be conducive to the regulation of the online gaming businesses," said Kou Xiaowei, vice director of GAPP's technological and digital department.
According to the English-language Shanghai Daily, GAPP has already started a crackdown on "online games operating illegally and featuring unhealthy content". As of last Thursday, more than 200 online games had been investigated and 45 overseas online games banned, the newspaper reported.
NetEase.com, Inc. (NASDAQ:NTES) declined 7.8 percent on the news on Friday as its Chinese servers of World of Warcraft (pictured) may be under threat. NetEase's CEO Lei Ding declined to comment on the notice, reported Sohu.com.
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