In July 2025, the Shanghai Municipal Government issued a broad package of incentive policies under the “Measures to Promote the High Quality Development of the Software and Information Services Industry”, which is effective from July 1, 2025. The program covers 17 specific measures across four major categories and also entails a pilot program to treat game titles developed by foreign funded studios in Shanghai as “domestic” games for licensing purposes (Pilot):
1. Stimulating business vitality
2. Supporting AI‑driven industry upgrades
3. Reducing costs and burdens
4. Cultivating digital content leaders
Foreign‑funded entities physically based in Shanghai (with real R&D teams and IP registered under the Shanghai entity) can now apply for game licensing via the domestic track instead of the imported-game route.
Difference of Imported Games VS Domestic Games and why the reclassification under the Pilot could make a big difference: The China National Press and Publication Administration (NPPA) classifies all games into two categories — imported and domestic — when issuing game approvals, also known as ISBNs. Though there is no official definition distinguishing these two categories, imported games are generally understood to be those whose copyright (including game software and content) is held by foreign entities, including foreign-invested companies established in China. While domestic games are those whose copyright is fully owned by Chinese natural/legal persons. Legally speaking, NPPA should apply the same set of content censorship criteria when reviewing all games and granting the ISBNs. However, practically speaking, it is perceived that foreign game developers face more difficulties in obtaining approvals compared to Chinese game companies that seek approvals for domestic games. Also, much less ISBNs for imported titles are granted and according to public sources, ISBNs for imported titles averaged less than 10% of domestic titles (e.g. in 2024, China issued 1,306 domestic game licenses, but only 110 for imported titles). With the Pilot, a new pipeline for foreign-developed games to access the larger domestic quota could be opened.
Faster approvals: Imported games often take 18–24 months to get licensed; domestic titles typically 6–12 months. Thus, treating Shanghai‑based foreign games as domestic could cut approval times significantly. That being said, it will still be the case that unlike domestic titles tailored for Chinese users, imported titles need a certain degree of localization effort to obtain NPPA approval and meet Chinese users’ expectations.
A significant number of domestic casual games can benefit from faster track approval, with ISBNs typically granted within 20 working days. This is designed to accommodate the short lifespan and development cycles of casual games. However, imported casual titles are explicitly excluded from this beneficial treatment according to the NAAP’s current rules.
Although the implementation details and timeline are yet to be disclosed, this Pilot addresses major challenges faced by international game companies.
While procedural access is via the domestic track, foreign-origin games may still face tighter internal scrutiny compared to domestic Chinese games.
It remains unclear whether games based partially on internationally licensed IP will qualify under this Pilot.
Foreign investors and their subsidiaries in China are still not allowed to engage in game publishing and operation business. Consequently, the prevailing model – licensing foreign-copyrighted games to Chinese partners who handle ISBN acquisition as well as game publishing and operation – should remain unchanged under the Pilot if not adapted further.
Without the clear implementation guidelines being issued, the requirements concerning game copyright registration, the number of development team members based in Shanghai and other factors, such as local software development in Shanghai while games are based on offshore-licensed works, remain yet to be clarified.
Thus, Shanghai-developed games of internationally invested companies based in Shanghai may not necessarily enjoy an entirely equal footing with those of Chinese competitors but at least the unequal treatment gap should be closed a bit more under the Pilot.
Susanne Rademacher
