A view of ByteDance's stand at the Digital China Summit 2021 Photo: cnsphoto

Chinese tech firm ByteDance, which owns popular short-video platform TikTok, said on Wednesday that it is downsizing its investment department, and will instead put more focus on business operations, according to a note the company sent to the Global Times.

"At the beginning of the year, the company carried out an analysis of the business, and we decided to strengthen our focus on business and reduce low-synergy investment," ByteDance said, adding that the employees of the strategic investment team will be dispersed into various business lines.

The company will strengthen cooperation among strategic research teams and business units. The business lines and teams involved are still in planning discussions, the company said.

Earlier on Wednesday, Chinese technology news portal 36Kr reported that ByteDance will disband its investment business, which had about 100 employees, with the financial investment unit completely eliminated, citing multiple sources familiar with the matter.

The move could be regarded as "a reaction of its executives to the regulatory policy that has just been issued," the 36Kr report said, citing online information that suggests "pre-approval is required for listing, investment and financing activities of internet-based platform companies with more than 100 million users or where the previous year's revenue surpassed 10 billion yuan ($1.6 billion)."

Citing sources familiar with the matter, Reuters reported on Wednesday that the Chinese internet regulator has drafted new guidelines that will require the country's internet behemoths to obtain its approval before they undertake any investments or raise funds. 

In response, the Cyberspace Administration of China (CAC), China's cyberspace regulator, denied the report late on Wednesday, saying it has never issued such guidelines and the content is untrue.

China has been redoubling efforts to regulate the internet economy, in order to rein in illegal activities and unchecked expansion that hamper the industry's sustainable development.

The CAC earlier this month ordered domestic platform companies with data from more than 1 million users to undergo a security review prior to overseas IPOs. It was the latest amendment to the country's Cybersecurity Review Measures, and will be effective from February 15.

Global Times