China Tightens Livestream E-Commerce Rules, Introduces AI Hosts for the First Time

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China is stepping up its regulation of the live-streaming e-commerce sector, which handles over CNY 4.5 trillion (USD 644.1 billion) in annual transactions. New rules have been introduced to govern artificial intelligence-generated content, including virtual hosts, for the first time.

The guidelines, known as the Supervision and Management Measures for Livestream E-Commerce, incorporate advanced technologies like AI digital avatars and AI-created videos into the regulatory landscape. Released by the national market regulator and cyberspace authority, they mandate clear labeling of AI hosts and require consistent consumer notifications that such hosts are AI-powered.

These regulations specify legal responsibilities for platforms, channel operators, hosts, and multi-channel network agencies. Platforms must verify user credentials, report relevant information, and address illegal conduct. Livestream operators are tasked with enhancing transparency, identity verification, and compliance checks, while MCN agencies are expected to standardize host recruitment, training, management, and verification procedures in commercial arrangements and product selection.

To combat prevalent issues such as fake transactions and false reviews, the rules explicitly prohibit deceptive promotional practices like click farming. This move aims to steer competition back toward product quality rather than solely relying on online marketing strategies. Industry insiders view these measures as a positive step toward emphasizing genuine product value while recognizing AI’s role in enhancing efficiency in areas such as product selection, customer service, and content creation.

Livestream commerce generated an estimated CNY 4.5 trillion (USD 644.5 billion) in 2024, representing nearly a third of all online sales and accounting for 80 percent of the sector’s growth, according to a report from the development research center of the regulation authority. Over half of the total gross merchandise volume now originates from merchants’ own live streams, with AI technology playing a pivotal role—especially through 24/7 AI hosts that help vendors significantly reduce costs.