Tencent Video and iQiyi have been “operating illegally” in Taiwan by partnering with local broadcasters and distributors to provide their video content through streaming services, according to a government notice published online Tuesday.
To put a stop to that, Taiwan’s National Communications Commission announced new rules that would prohibit Taiwanese individuals and companies from providing services to mainland Chinese streaming operators and distributing their content, according to the notice.
The regulator’s decision is provisional pending a 14-day public comment period. The rules are set to take effect on September 3. Tencent declined to comment, while iQiyi did not immediately respond to questions from CNN Business.
Taiwan is a self-governing democracy which Beijing continues to view as part of its territory. With a population of around 24 million people, the damage to the Chinese companies will be limited. But the proposed ban is further evidence of the growing backlash against China’s tech champions in global markets.
In earnings reports last week, Tencent said its video service had 114 million subscribers and iQiyi reported nearly 105 million. The vast majority of those subscribers are in mainland China, according to analysts.
Trump earlier this month threatened to ban Tencent’s popular messaging app WeChat and TikTok, the wildly popular video sharing platform owned by China’s ByteDance. Trump last week also ordered ByteDance to divest interest in TikTok’s US operations within the next 90 days.
Government officials often cite national security concerns for the restrictions, although companies such as Huawei and ByteDance have repeatedly denied that their apps pose a national security risk.
— Steven Jiang, Vanesse Chan and Ben Westcott contributed to this report.