HONG KONG, Jan 18 (Reuters) – Tencent Holdings shares (0700.HK)the world’s largest gaming company and its smaller rival, NetEase Inc. (9999.HK) rose on Wednesday after China’s video game regulator granted the first gaming licenses in 2023, further easing a crackdown on the industry.

Tencent shares rose as much as 1.7% in early trading before paring gains, while NetEase shares rose as much as 5.8% to their highest level in more than four months.

The publishing licensing of 88 online games on Tuesday is the latest sign that a regulatory crackdown that began in August 2021 and took a heavy toll on the world’s largest gaming market is ending.

Unlike in most other countries, video games need regulatory approval before being released in China.

The crackdown was aimed at purging content the government did not approve of, with companies being asked to remove content that was violent, seen as celebrating wealth or encouraging celebrity worship.

Last month, China’s decision to license 44 foreign games for domestic release was the strongest sign that the crackdown was ending.

Regulators resumed issuing gaming licenses for local games last April, with the approval of foreign games seen as the latest regulatory restriction to be lifted.

Reporting by Anne Marie Roantree; Edited by Jacqueline Wong and Jamie Freed

Our standards: The Thomson Reuters Trust Principles.

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