China Fines Tencent, Tech Giants Over Child Exploitation

Zheping Huang, Bloomberg News

The Tencent Holdings Ltd. headquarters, center, in Shenzhen, China, on Saturday, March 20, 2021. Asia’s largest conglomerate was censured by China’s antitrust watchdog on Friday as Beijing expands a crackdown that began with Jack Ma’s online empire. Photographer: Qilai Shen/Bloomberg , Bloomberg

(Bloomberg) -- Chinese internet regulators slapped fines on technology firms including Tencent Holdings Ltd. and Alibaba Group Holding Ltd. for spreading sexually suggestive content involving children.

Kuaishou Technology, Tencent’s QQ, Alibaba’s Taobao, Weibo Corp. and Little Red Book were ordered to remove the offending accounts and pay an unspecified amount in fines, the Cyberspace Administration of China said in a statement Tuesday. The penalties were issued as part of a campaign to tackle online content deemed “harmful to the physical and mental well-being of minors.”

The agency will “step up the enforcement of laws and regulations, and punish those who violate the rules,” CAC said in the statement. “There will be a ‘zero tolerance’ approach toward issues that hurt minors.”

In recent months, social media users and state news outlets have called out e-commerce platforms where sellers use suggestive photos of child models to sell goods as well as manipulated gifs and videos that exploit minors. The cyberspace regulator is also planning to tackle under-aged live-streaming, the quality of online education platforms, violent and sexually explicit animation, online communities and celebrity fan clubs as part of its campaign, the statement added.

Read: Xi Elevates Obscure China Watchdog to Take On Didi, Big Tech

The crackdown adds to the pressure on China’s internet sector, which is already facing scrutiny over issues ranging from antitrust to data security. The CAC this month burst into prominence after announcing a probe into Didi Global Inc. and unveiling rules that will require any company seeking to go public in a foreign country to seek its approval.

Kuaishou sank as much as 3.2% following the CAC’s statement. Tencent shares were nearly 2% lower while Alibaba slid 0.6% in afternoon trading.

Global technology companies have also been taking steps to tackle child exploitation. Facebook Inc. in February announced new tools to prevent users from sharing content that victimizes children.

(Updates with share performance in sixth paragraph.)