China has banned children from playing online games more than 3 hours per week. This is the most severe restriction on the gaming industry in China as Chinese regulators crack down on the technology sector.
According to the National Press and Publication Administration, minors in China cannot play games between 8 p.m. and 9 p.m. on Fridays and weekends and on public holidays that began Sept. 1.
This restriction restricts gaming to 3 hours per week most weeks of the calendar. It is a decrease from a 2019 restriction that allowed minors to play games for 1 hour and 15 minutes per day, and 3 hours on public holidays.
Some of China’s biggest technology companies are affected by the new regulation, including Tencent, which is responsible for the online multiplayer game Honor of Kings. It is also popular worldwide, and NetEase, which is responsible for gaming.
Tencent stock closed at 465.80 Hong Kong dollar on Monday, 0.6% lower than the previous regulator’s announcement. Its market capitalization is $573 billion, which is more than 300 billion less than its February peak. This decline is equal to the total value of Nike Inc. and Pfizer Inc.
NetEase, a New York-listed company, saw its stock drop by 9% during the open market.
Gaming restrictions are part of an ongoing crackdown against technology companies amid concerns that technology firms, many of whom provide ubiquitous messaging, payment and gaming services, may have an outsized impact on society.
Tencent announced earlier this month that it would limit minor gamers’ gaming time to one hour per day and two hours during holidays. It also said that children under 12 years old will be banned from purchasing in-game items.
After a newspaper affiliated with the state had criticised the gaming industry, and called them “spiritual pain pills”, the company issued the curbs.
Monday’s notice from regulators stated that they will strengthen supervision and increase frequency of inspections for online gaming companies in order to ensure they adhere to the regulations.
Chinese authorities have been focusing on e-commerce in recent months and online education in recent months. They have also implemented new regulations to stop anti-competitive behavior following years of technology sector growth.
Authorities banned tutoring companies in core school subjects from making a profit last month. This wiped out billions of market value from online education providers like TAL Education or Gaotu Techedu.