China Bans Foreign Investment in the Online Gaming Industry

Though the online gambling laws in China have not been directly amended, the new bans placed on foreign investment in the Chinese online gaming industry do directly affect gamblers. Over the past week Chinese government regulators banned foreign investment in their domestic industry.

China’s policy on online gambling is very similar to that which is currently in place in the US. It’s illegal within the country but accessible through foreign sites. There are many sites available to Chinese players and there are even a few that directly cater to them with traditional and modern Chinese.

The Chinese Government tries to control online gamblers by threatening them with hefty fines and extensive prison sentences but, as is the case in the US, these laws are very difficult to enforce due to the general difficulty of following internet traffic. As they say, “where there’s a will, there’s a way” and in China there is a BIG will.

Chinese officials are some of the most animated gamblers. One example is Li Weimin, the mayor of a small city in Guangdong who lost more than 90 million Yuan gambling between 1998 and 2004. According to Asia Times, “A 2008 study of 99 high rollers from mainland China showed that 59 had some sort of state affiliation.”

The new ban on foreign investments is far from simple. Not only are direct foreign investments blocked, investors are also banned from “indirectly influencing” Chinese online game companies by providing technical support or signing relevant contracts.

The General Administration of Press and Publication is the department that is in charge of this ban in conjunction with the department of Culture. Some of the games released by foreign investors were considered to be morally objectable. Online casinos and gambling were included in a grouping of unhealthy content also including violence, crime and pornography.