China has proposed a ban on algorithms that “encourage addiction or high consumption”, or risk national security or public order, in another round of its regulatory crackdown.
In draft guidelines published by the Cyberspace Administration of China (CAC) today, algorithm providers with “social mobilisation capabilities”, or algorithms with large public influence, should first apply through the CAC for permission to use such algorithms.
These types of algorithms must also carry out safety assessments “in accordance with relevant national regulations”.
The internet watchdog, which reports to a central leadership group chaired by president Xi Jinping, has also suggested that companies in the internet sector must ensure their algorithms are not used to create fake user accounts or other false impressions such as fake reviews.
Some of the suggestions appear to target the growing influence of internet algorithms in stoking consumer behaviour, such as allowing users to select, modify and delete user tags used for online recommendations.
It echoes statements made in local state-run media at the beginning of the month which tipped major market volatility for China’s tech giants.
An article by Economic Information Daily likened the rise of gaming to “spiritual opium” and a “new type of electronic drug” that was “advancing by leaps and bounds”.
The CAC wrote: “When an algorithm recommendation service provider sells goods or provides services to consumers, it shall protect the legitimate rights and interests of consumers, and shall not use algorithms to implement unreasonable trading conditions such as transaction prices based on the characteristics of consumers’ preferences and trading habits.”
The internet watchdog will be taking on feedback on the fresh set of guidelines until 26 September.
It comes as China’s regulatory crackdown on the technology sector has locked eyes on data sensitive firms and the US stock market.
The China Securities Regulatory Commission has proposed banning firms with a large amount of sensitive data from engaging in US initiail public offerings (IPOs).
Though, those in the pharmaceutical industry, are still likely to receive regulatory approval for foreign listings, according to the Wall Street Journal.