Chinese tech stocks including Alibaba (BABA), Baidu (BIDU), NetEase (NTES), and Bilibili (BILI) were trending lower in trading on Wednesday after China’s cyberspace regulator, the Cyberspace Administration of China (CAC) proposed some sweeping changes to regulations regarding smart devices. The regulator stated that it wanted tech companies that provide smart devices to restrict children under the age of 18 to a maximum of two hours a day on their smartphones.
In order to do this, the CAC wants tech companies to introduce “minor mode programmes” that would prohibit children from accessing the internet on their mobile devices during the hours from 10:00 p.m. to 6:00 a.m. The regulators made it clear that smart device providers would have to set time limits. According to these proposed reforms, users in the age group of 16 to 18 years old would be allowed two hours a day, while children in the age group between eight and 16 years old and children below eight years would get one hour and eight minutes respectively, on their devices.
However, the CAC has added that service providers will give parents the option to opt out of the time limits set for their children. These proposed changes are open to public feedback until September 2.
China’s macroeconomic woes and its strained trading relationship with the U.S. has dragged down the iShares MSCI China A ETF (CNYA) by more than 10% in the past six months.
