China is attempting to tighten guidelines on unfair web competitors, which is driving down expertise shares

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GUANGZHOU, China – China’s market regulator on Tuesday released draft rules aimed at halting unfair competition on the internet as Beijing continues to crack down on the country’s tech sector.

The rules published by the State Administration for Market Regulation (SAMR) cover a broad spectrum, from prohibiting the use of data by companies to eradicating fake product reviews.

Chinese listed technology stocks in Hong Kong fell sharply on the news. Gaming giant Tencent was down 3.5% in late morning trading, while e-commerce giant Alibaba was down 2.5%.

The latest rules from SAMR continue Beijing’s regulatory attack on China’s tech giants.

Here are some of the other important rules:

  • Operators should not provide incorrect data such as the number of clicks on content.
  • Operators shouldn’t hide negative reviews and only promote positive reviews.
  • Internet platforms should not use data, algorithms and other technical means to influence the choice of users, or use other methods to carry out so-called traffic hijacking. This is where a company is trying to redirect a user to their own website or service while browsing another.
  • Operators should not use data and algorithms to collect and analyze trade information from competitors.

SAMR said it could hire third-party institutions to review data if an operator breaks the rules.

The regulator will get public opinion on the new rules by September 15th. They have not yet come into force.

However, the draft rules from SAMR underscores the urge of the market surveillance authority to tighten the laws relating to antitrust and competition law. At the beginning of the year, the authority issued antitrust guidelines for the so-called platform economy.

The regulator has also cracked down on China’s tech giants.

Alibaba was fined $ 2.8 billion in April for an anti-monopoly investigation, and SAMR is currently investigating grocery supplier Meituan for “suspected monopoly practices”.

– CNBC’s Iris Wang contributed to this story.

This is a developing story. Please look back to find out more.

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