China's Next Regulatory Target — Algorithms, the Secret of Many Tech Giants' Success

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China's Next Regulatory Target — Algorithms, the Secret of Many Tech Giants' Success
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Investors will be watching whether China’s algorithm rules will affect the business models of companies like Alibaba and Tencent.

Here are some of the provisions in China's algorithm regulation:

Algorithmic recommendation services that provide news information need to obtain a license and cannot push out fake news. This provision was a new addition to last year's draft rules. Companies must facilitate the"safe use" of algorithmic recommendation services for the elderly, protecting them against things like fraud and scams. This was also a new addition to the previous draft.

But enforcement of the algorithm regulation could set up a clash between regulators and tech companies. That's because in order for regulators to find violations, they may have to inspect the code behind algorithms.

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