As the ban against Chinese over-the-top (OTT) service provider iQiyi (愛奇藝), an online movie and video streaming service, went into effect yesterday, iQiyi’s authorized agent criticized the policy’s implementation, saying that employees would soon need to be laid off.
A new regulation set by the Ministry of Economic Affairs (MOEA) last month — dubbed the “iQiyi provision” — prohibits Taiwanese agents and companies from helping the Taiwanese operations of Chinese OTT service providers.
Taking effect yesterday following a two-week public review period, the regulation makes it illegal for Taiwanese agents to collect fees, provide customer service or advertise on behalf of Chinese service providers.
Photo: Peter Lo, Taipei Times
“The ban will not solve any national security issues... However, Taiwanese companies must obey the law, so we will have to cut jobs in the coming days,” Fan Li-da (范立達), chairman of OTT Entertainment, iQiyi’s Taiwanese agent, told ministry officials yesterday.
The intent of the law is to prevent Chinese OTT firms from gaining access to components of Taiwan’s national security and wreaking havoc on information networks, the ministry said.
Last month, the National Communications Commission (NCC) proposed a draft bill on the management of Internet audiovisual services, which would oversee and restrict OTT providers.
The bill would required OTT firms to comply with the Act Governing Relations Between the People of the Taiwan Area and the Mainland Area (台灣地區與大陸地區人民關係條例) or local telecoms would be required to block the streaming services, with offenders facing fines of up to NT$5 million (US$169,314).
“The law regulating OTT is a unique law found in no other countries,” Fan told an NCC public hearing on the bill yesterday. “I can feel that all of the business operators in this sector are afraid of it.”
“We will face a reduction in our business and the painful decision of having to cut jobs, which we feel dismal about, as it will affect more than 20 employees and their families,” he said. “However, the layoffs resulted from rapid changes in government policy and not from our company committing illegal acts.”
The MOEA believes that China’s online movie and video streaming services have sensitive issues regarding Taiwanese politics, society and culture, as well as national security, Fan said, adding that to prohibit companies like his from working as agents would not resolve such problems.
Fan said that NCC officials had earlier said that local subscribers could watch iQiyi streaming online, making it difficult to understand their reasoning for the ban.
“I have promised to work out solutions for subscribers who purchased iQiyi programming from our company, but whose consumer rights have been affected,” Fan said. “As we terminate the agency relationship, these subscribers will need to turn to the NCC or the MOEA for a settlement.”
Additional reporting by Jason Pan
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