President Donald Trump signed an executive order today to ban transactions between American companies and citizens and Chinese holding company Tencent, which wholly or partially owns some of the largest game developers in the world, including Riot Games, Epic Games, and Supercell.
This ban is set to go into effect 45 days from now, which would just exceed Trump’s previous deadline of Sept. 15 for when TikTok owner ByteDance would need to sell the social media app to an American company.
The order states “any transaction that is related to WeChat by any person, or with respect to any property, subject to the jurisdiction of the United States, with Tencen Holdings Ltd. … or any subsidiary of that entity” would be prohibited in 45 days. Attorney Roger Quiles said this impacts not only WeChat, but it also “bans unspecified transactions with Tencent.”
“The language is not especially clear, and the prohibited transactions are not specified,” Quiles told Dot Esports. “However, at face value, prohibiting transactions with Tencent could, depending on how narrowly defined the prohibited transactions are, impact their esports and video games companies.”
Quiles said “time will tell” as to how this will affect Tencent, which owns 100 percent of Riot Games, the developer and publisher of League of Legends, VALORANT, Teamfight Tactics, Wild Rift, and Legends of Runeterra. Tencent also owns 81.4 percent of Supercell, a Finnish mobile game developer that created Clash of Clans, Clash Royale, and Brawl Stars.
Additionally, Tencent is a minority owner of Epic Games, which developed and published Fortnite, the massively successful battle royale game. Tencent purchased 40 percent of the company in 2012 for $330 million. TiMi Studios, which developed Call of Duty: Mobile, is also a subsidiary of Tencent.
In the executive order, the White House alleges WeChat “automatically captures vast swaths of information from its users” and the data collections “threatens to allow the Chinese Communist Party access to Americans’ personal and proprietary information.”
Update Aug. 7 8:10am CT: A White House official told the Los Angeles Times that the executive order “only blocks transactions related to WeChat,” according to reporter Sam Dean. “Video game companies owned by Tencent will NOT be affected by this executive order,” Dean said.
Disclaimer: Roger Quiles represents Dot Esports’ parent company, GAMURS Group.