Taiwan to stop local sales for Chinese TV streaming services, not block them

iQiyi applied in 2016 to set up a Taiwan subsidiary, but was rejected. PHOTO: REUTERS

TAIPEI (REUTERS) - Taiwan plans to stop local sales for Chinese internet television streaming services operated by the likes of iQiyi and Tencent Holdings, according to regulations released this week, but does not plan on blocking the services.

Democratic Taiwan, claimed by China as its sovereign territory, has long been suspicious of Chinese attempts to sway its population, including by use of fake news spread online and efforts to influence Taiwan media.

The Ministry of Economic Affairs said late Tuesday (Aug 18) the rules barring Taiwanese companies from selling or operating as sales agents for Chinese internet streaming services will take effect Sept 3.

The service iQiyi applied in 2016 to set up a Taiwan subsidiary, but was rejected because Chinese companies cannot operate online streaming services there, the ministry said.

However, Taiwan is not blocking or banning them, the National Communications Commission said.

"People can still watch and pay for overseas subscriptions,"commission deputy chief Wong Po-Tsung told Reuters, adding that officials would ensure subscribers' rights are not affected.

The commission ruled in May, after months of debate, that Chinese online television service providers would not advertise their services in Taiwan.

Baidu-backed, Netflix-like iQiyi said in a statement issued by unit iQiyi International that it was paying close attention to the situation and that it believed it should "not become the specific target of legislation".

"We wish to see the Taiwanese government departments involved recognise the benefits of an open market economy," it added.

Tencent, which runs Tencent Video, declined to comment.

Taiwan has a free internet, unlike China, which blocks sites such as Google, Facebook and Twitter. Taiwan also does not ban access to popular Chinese apps like WeChat or sites like Baidu.

China does not permit Taiwanese firms to offer internet television streaming services.

Chinese internet giants have come under pressure internationally, led by the United States, where President Donald Trump ordered ByteDance last week to divest video-sharing app TikTok's US operations within 90 days, the latest effort to ramp up pressure on the Chinese company over concerns about data security.

The US Securities and Exchange Commission is investigating iQiyi after a short seller accused it of inflating user numbers and prices, it said last week.

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