On May 6th, the giant Chinese corporation – Tencent, entered a hearing with U.S. officials to prove its innocence amid suspicions of illegal user data exploitation.
Specifically, the Committee on Foreign Investment in the United States has received several allegations and is investigating whether some foreign-invested companies are illegally collecting user information on U.S. soil, including Tencent, through two gaming firms, Riot Games and Epic Games.
Tencent currently owns the entire stake of Riot Games – the creator of League of Legends, as well as being the main shareholder of Epic Games. These two brands boast a customer base of tens of millions and are accused of being controlled by the Chinese corporation, potentially posing “national security risks.”
This committee has demanded that Tencent divest its investments from companies headquartered in the U.S., including Riot and Epic. However, U.S. officials have also proposed an alternative option, which is that Tencent must withdraw from other key investment portfolios if they wish to retain investment rights in these two companies.
Additionally, all three parties – Tencent, Riot, and Epic – will have to enter into a debate to prove they are not engaging in user data exploitation. Riot, which is now fully owned by Tencent, has stated that this corporation only plays a role in providing capital, while the operation and product direction are entirely under the authority of the leadership team currently based in the U.S.
Tencent is the sole owner of Riot after acquiring a majority stake in the company back in 2015. They also hold 40% of Epic’s shares.
However, one of the arguments raised to demonstrate Riot’s independence in development is the release of League of Legends: Wild Rift, a product considered a direct competitor in the mobile MOBA game segment against Honor of Kings from parent company Tencent.
