BEIJING/SHANGHAI (Reuters) – Tencent Holdings Ltd. ‘s shares rose on Friday after a local regulatory official said, a number of new video games was approved for sale, the end of a long-term freeze in the approvals that scared players in the world’s largest gaming market.
FILE PHOTO: A Tencent sign is seen during the fourth Internet World Conference in Wuzhen, Zhejiang province, China, Dec. 4, 2017. REUTERS/Aly Song
Feng Shixin, a senior official of the ruling Communist y of the Propaganda department, said in a speech at a gaming conference in the southern city of Haikou that a first batch of approvals for the games was completed, according to a transcript of the speech, and the organizers of the event.
That helped propel Tencent’s shares up 4.6 percent, bringing its gaming-social media giant is on course for the steepest daily rate jump in more than a month.
China stopped the approval of new titles of March, in the midst of a statutory review triggered by the growing criticism of video games for violent and leads to myopia as well as addiction among young users.
The freezing of new approvals has been under pressure gaming-related shares, and clouded the outlook for mobile games, the rattling of the industry leader Tencent and colleagues such as NetEase, Inc.
“We hope that through the new design of the system and strong execution, we could allow game companies to better present the common values, strengthening of the cultural significance of the task and mission, and to better meet the public need for a better life,” Feng said.
Earlier this month, state media reported that Chinese regulators had set up an online video games ethics commission, raising hopes the government was preparing to resume an approval process that has been frozen for most of this year.
“This is clearly exciting news for China’s gaming industry,” a Tencent spokesperson said in a written explanation.
“We are confident that after the publication of license-consent, we will ensure more compliant, high-quality cultural works for the society and the public.”
The gaming freeze in China has dragged down Tencent shares this year and wiped billions of dollars off the market value. The firm’s stock is down more than 20 percent in 2018.
According to a Hainan propaganda department, a civil servant in the gaming event, a new pilot approval mechanism is set to be rolled out in the tropical province, including positive and negative lists, a combination of artificial intelligence, audits and expert censorship.
Some insiders, however, said that she remained cautious to see what the new scheme would look like in action.
“Although there is no clear legislation on the video game regulation, it is up to the supervisor to decide what they are going and what they are not. There is still a lot of uncertainty,” says executive Tencent’s game division, asking not to be named.
Reporting by Adam Jourdan and Brenda Goh in SHANGHAI and Pei Li in BEIJING; Editing by Himani sarkar Cushing and Christopher