Tencent Stock Down as Gains New Video Game Publishing Licenses in China

Tencent Stock

A Chinese regulatory body has granted publication licenses to Tencent stock (OTCPK:TCEHY) and a number of other businesses so they can distribute foreign video games in China.

For the month of December, the National Press and Publication Administration issued licenses for 45 international games, including Riot Games’ Valorant and Pokemon Unite, both of which were created and released by Tencent in collaboration with Nintendo (OTCPK:NTDOY).

Tencent stock movement

Tencent stock (OTCPK:TCEHY) was slightly higher on Wednesday in premarket trade. 84 domestic games, including those from TikTok creator ByteDance (BDNCE), were also approved for December.

In recent months, China has loosened up on its crackdown on the video gaming industry. Both Tencent (OTCPK:TCEHY) and NetEase (NTES), who derive a sizable percentage of their revenue from video games, have been adversely affected by the decision.

The Chinese government allowed a mobile game from NetEase (NTES) in September, its first approval since July 2021, and the company’s stock surged as a result. According to Reuters, which cited a source with knowledge of the situation, Tencent (OTCPK:TCEHY) obtained six licenses in December through a number of related businesses. Tencent (OTCPK:TCEHY), founded by Pony Ma, obtained its first license in November after going around 18 months without one.

Tencent (OTCPK:TCEHY), which owns about 40% of Epic Games, has consented to pay a $520M fine to the U.S. Federal Trade Commission for violating children’s online privacy rights and deceiving them into making pointless in-game purchases.

In order to settle claims that the Fortnite publisher violated children’s online privacy protections and deceived players into making unnecessary in-game payments, Epic Games has agreed to pay $520 million. 

Two claims against Epic are resolved by the settlement. In one lawsuit filed in federal court, Epic was charged with breaking the Children’s Online Privacy Protection Act by collecting the personal data of Fortnite players under 13 years of age without parental consent.

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