Sources familiar with the matter said on Wednesday that China's cyberspace regulator has prepared new guidelines that will require the country's internet behemoths to acquire its approval before undertaking any investments or fundraisings.
According to the Cyberspace Administration of China (CAC), the proposed requirements will apply to any platform company with more than 100 million users or more than 10 billion yuan ($1.58 billion) in revenue.
Any internet firm involved in sectors listed on China's National Development and Reform Commission's negative list last year will also need to apply for an approval, the sources said.
They also mentioned that several internet businesses have already been briefed and that the draft rules are still subject to change.
The proposed measures are the latest from China's more assertive regulators, who have reined in the country's formerly free-wheeling Internet behemoths in areas ranging from deal making to user data handling in the last year.
The CAC published a new set of rules this year that require platform businesses with data on more than 1 million users to undergo security evaluations before listing overseas. The rules go into effect on February 14th.
It was unclear at the time what types of investments or fundraisings may be affected. There are concerns, according to one senior technology industry executive, that it would be applied to private market investments, such as pre-IPO private capital rounds.
China keeps a negative list of industries where foreign investment is prohibited, such as compulsory education institutions, news organisations, and rare earth minerals, updated on a regular basis. The NDRC required businesses in certain sectors to seek regulatory clearances before listing their shares outside of the mainland late last year.