Chinese regulator grants license to 44 video games for domestic release

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Video game regulator in China initially granted licenses to 45 foreign video game titles for release in the nation, including seven South Korean games lifting strict restrictions that have plagued the Chinese gaming sector for the past 18 months. However, the regulator later removed a game called ‘Game of Thrones: Winter is Coming’ from the list of approved games with no specific reason.

A day after Chinese officials granted publishing licenses, South Korean gaming stocks for Netmarble, NCSOFT, Krafton, Kakao Games, and Devsisters, increased by between 2% and over 17% in morning trade on Thursday.

Tencent Holdings will be publishing five games including Pokémon Unite by Nintendo
and Valorant by Riot Games which are included in the games approved by the National Press and Publication Administration.

Beijing’s campaign against the video game sector began in August of last year when regulators halted the clearance procedure for new games which now seems to be coming to an end. In April, regulators started issuing game licenses to domestic games again, and it was believed that approving overseas games was the final regulatory barrier to be lifted.

Even after being the biggest gaming market in the world, video games need to be approved before they are accessible to the public. Due to this rule, many big companies in China have faced significant losses as these companies generate significant profits from the sale of their own games as well as imported ones.

According to a source with knowledge of the situation who spoke to Reuters, Tencent, the largest gaming business in the world, effectively acquired a total of six licenses in December through various linked entities.

Only last month did Tencent obtain its first commercial game license in more than a year and a half, which was regarded at the time as a significant indicator of the industry’s impending regulatory normalization.

Along with Tencent, other game developers who obtained approval in December include NetEase, ByteDance, XD Inc., and iDreamSky. In Hong Kong, shares of Tencent, XD Inc., and iDreamSky increased by 0.8% to 5.2%, while Nintendo of Japan increased by 0.2%.

The founder of Tencent, Pony Ma, stated in a year-end meeting this month that the company must get used to Beijing’s stringent licensing requirements and that the number of new games that China licenses will ultimately remain constrained.