China publishes regulation for algorithms used in recommendation systems

Chinese authorities have published the final version of a new regulation which introduces rules to rein in algorithms used by tech companies to recommend what users would like to read, watch, play, or buy online. The regulation, to enter into force on 1 March 2022, was developed by the Cyberspace Administration of China, the Ministry of Industry and Information Technology, the Ministry of Public Security, and the State Administration for Market Regulation. Approved in November 2021, the regulation is based on a draft version which was made available for public comment in August 2021. Internet platforms (e-commerce, social media, delivery, etc.) are required to allow consumers to decline personalised recommendations generated by algorithms, and to delete or keep certain tags the platforms attach to them for making recommendations. The regulation includes transparency requirements as well, directing companies to reveal the principles, intentions, and main operating mechanisms used as part of the algorithm-based recommendation systems. Moreover, companies are barred from designing models that encourage users to engage in ‘excessive spending’ or develop an addiction to the platforms. The new rules also contain provisions preventing service providers from using algorithms ‘to impose unreasonable restrictions on other Internet service providers, hinder or disrupt the normal operation of services they provide, and carry out monopolies and unfair competition’.