India is blocking Grafton’s game under the same law that China used to ban apps, the source said

NEW DELHI, July 29 (Reuters) – India has blocked the popular battle-royal format game from Grafton Inc. (259960.KS)A South Korean company backed by China’s Tencent (0700.HK)Using the law, which came into effect in 2020, Chinese apps were to be banned for national security reasons, a source said.

Battlegrounds Mobile India (BGMI) has been spun off from Alphabet Inc (GOOGL.O) Google Play Store and Apple Inc (AAPL.O) App Store in India till Thursday evening.

The removal of BGMI, which had over 100 million users in India, comes after India banned another Grafton title, PlayerUnknown’s Battlegrounds (PUBG), in 2020.

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The PUBG crackdown is part of New Delhi’s ban on more than 100 mobile apps of Chinese origin following a months-long border war between the nuclear-armed rivals.

The ban has expanded to cover more than 300 apps, including the popular gaming app ‘Free Fire’, owned by Singaporean technology group Sea Ltd. (SE.N).

According to Grafton’s regulatory filing, Tencent held a 13.5% stake in Grafton through an investment vehicle at the end of March.

Grafton shares fell more than 9% on Friday’s news, then traded down 4.5% in late afternoon trading in Seoul. India reported a high single-digit percentage increase in its revenue in the first quarter of this year in May, the company said.

A Google spokesperson said it blocked the game following a government order, while India’s IT ministry and Apple did not respond to requests for comment.

In Seoul, a Grafton spokesperson said the developer was talking to relevant authorities and companies to determine the exact circumstances surrounding the suspension of the two major app stores in India.

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“Government doesn’t interfere with what apps can and can’t work. They interfere with digital security and privacy concerns and BGMI complies with all guidelines. MeitY (Ministry of Electronics and Information Technology) has mentioned that PUBG and BGMI are different games,” Grafton’s India CEO said. Sean Hyunil Son told news website TechCrunch earlier this week.

‘Chinese Influence’

India used a section of its IT Act to impose the ban, the source, who had direct knowledge but declined to be identified due to the sensitivity of the matter, told Reuters.

Section 69A of India’s IT Act allows the government to block public access to content in the interests of national security, among other reasons. Orders issued under the section are generally confidential.

Prahar president Abhay Mishra said the Swadeshi Jagran Manch (SJM) and non-profit Prahar have repeatedly asked the government to investigate the “Chinese influence” of PGMI. The SJM is the economic wing of the Rashtriya Swayamsevak Sangh, an influential Hindu nationalist group close to Prime Minister Narendra Modi’s ruling party.

“In the so-called new avatar, BGMI is no different from the previous PUBG, Tencent still controls it in the background,” Mishra said.

The ban elicited strong online reactions from popular gamers in India on Twitter and YouTube.

“I hope our government understands that thousands of sports athletes and content creators and their lives depend on PGMI,” tweeted Abhijeet Andare, a Twitter user with over 92,000 followers.

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Reporting by Aditya Kalra and Munsif Venkat in New Delhi, Joyce Lee in Seoul; Additional reporting by Nubur Anand; Editing by Kirsten Donovan, Clarence Fernandez and Muralikumar Anantharaman

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