China Extends Ban on New Video Game Licences into 2022

China is extending its freeze on new video game licences into 2022, resulting in over 14,000 small studios and gaming-related firms in the country closing their operations over the past few months, the South China Morning Post is reporting.

China ban games

The freeze on new video game licences came months after President Xi Jinping raised the issue of gaming addiction among the country’s youth during the Chinese People’s Political Consultative Conference in March last year.

According to the publication, Chinese regulators have not released a list of approved new video game titles since the end of July 2021, which makes it the longest suspension since a nine-month hiatus in 2018. 

Even bigger firms like TikTok owner ByteDance and online search giant Baidu have had to cut their losses by laying off employees in the video gaming segment of their operations. The move has also prompted industry leaders Tencent Holdings and NetEase to put more resources in overseas markets instead.

“The recent company closures and lay-offs show the increased regulatory uncertainty in China, which ranks as the world’s largest and most lucrative video gaming market. That has made it increasingly difficult for companies to invest and draw up new video gaming projects in the domestic market.”

Back in August, China had also announced a three-hour weekly gaming restriction for minors to curb gaming addiction among the country’s youth.