China Steps Up Regulation of Livestream E-Commerce, Includes AI Hosts for First Time
China is tightening oversight of its livestream e-commerce industry, which processes more than CNY4.5 trillion (USD 644.1 billion) in transactions annually. The government has issued new rules that, for the first time, regulate artificial intelligence-generated content, including virtual anchors.
New Regulatory Measures
The Supervision and Administration Measures for Livestream E-Commerce now include emerging technologies such as AI digital avatars and AI-generated videos within the regulatory framework. These measures, released by the State Administration for Market Regulation and the Cyberspace Administration of China, mandate that AI hosts be clearly labeled, with continuous reminders for consumers that they are produced by AI.
Legal Responsibilities
The new regulations specify the legal responsibilities for various stakeholders in the livestream e-commerce ecosystem:
- Livestream e-commerce platforms must verify qualifications, submit information, and address illegal activities.
- Livestream channel operators are required to enhance information disclosure, identity verification, and conduct pre-compliance reviews.
- Multi-channel network (MCN) agencies need to standardize recruitment, training, and management of hosts, fulfilling verification responsibilities in commercial partnerships and product selection.
Combatting Click Farming
To address the persistent issue of click farming, the new rules explicitly prohibit misleading promotions, including those based on fake transactions and false reviews. These measures aim to restore competition focus back to products rather than overreliance on internet marketing.
The Role of AI in E-Commerce
The gross merchandise value (GMV) from livestream e-commerce was estimated to have exceeded CNY4.5 trillion (USD 644.5 billion) in 2024, accounting for nearly one-third of online sales and contributing 80 percent of the sector’s growth. A report by the State Administration for Market Regulation’s Development Research Center indicates that more than half of the industry’s total GMV now originates from merchants’ own livestreaming channels.
AI technology is increasingly utilized in these sessions, with round-the-clock AI hosts significantly reducing operational costs for vendors, thus enhancing overall efficiency.
