Taiwan authorities are closing a regulatory loophole to block mainland tech companies including Tencent Holdings and Baidu from offering video streaming services on the island amid the rising geopolitical tensions between China and the world. Tencent’s WeTV (the overseas version of Tencent Video) and Baidu’s iQIYI are both operating in a legal grey area in Taiwan by partnering with local companies to avoid preexisting restrictions on mainland services.
Taiwan’s National Communication Committee (NCC) will hold a public hearing on Sept. 3 about the new law on over-the-top media services. Taiwan’s Ministry of Economic Affairs also announced yesterday that it is publishing a new “ban list” to prevent local businesses from distributing video content produced by mainland Chinese companies, effective Sept. 3.
The new regulation, if in place, will prohibit local Taiwanese companies from partnering with iQIYI and Tencent, thus blocking their services from Taiwan audiences. IQIYI’s commission agency in Taiwan OTT Entertainment responded to Taiwanese media that it cannot predict the future implementation of the new law, but is surprised at the government’s “interfering free business conduct.” Tencent Video has declined to comment on the issue.
The Ministry said the violators of the new law will be investigated by the NCC in accordance with the Act Governing Relations between the People of the Taiwan Area and the Mainland Area and can be fined between NT $50,000 and NT $5 million.
IQIYI’s client services responded that the company is “fully committed to protecting the rights and interests of its users.” The service debuted in Taiwan in March 2016 and reported 20 million subscribers in the self-governed island in June 2016. Tencent’s WeTV app also hit over 1 million downloads across Taiwan‘s iOS and Android stores by the first day of 2020, less than a year after it debuted in 2019.