Compliance Issues in Metaverse Industrial Park

Under the situation of the rise of the Metaverse wave and the introduction of favorable policies, the Metaverse has moved from an illusory concept to a reality, and various places have begun to lay out the Metaverse industrial parks to seize the new track of the Metaverse. From Beijing Shougang No. 1 Blast Furnace SoReal Metaverse Paradise, Chengdu Qingbaijiang District Metaverse Digital Cultural Tourism Industrial Park to Hangzhou Qiantang Metaverse Xintiandi, the construction of 5G/6G, artificial intelligence, blockchain, digital twin, etc. The underlying infrastructure of the Metaverse, and then develop and promote the implementation of new scenarios of Metaverse applications such as games, social interaction, and education.

It is foreseeable that with the intensive introduction of local Metaverse policies and the booming construction of the Metaverse Industrial Park, a large number of enterprises with innovative spirit and entrepreneurial ability will inevitably be cultivated, incubated and promoted, so as to realize the development of the upstream, midstream and downstream industries of the Metaverse industry in my country. Perfect layout.Sister Sa’s team believes that Metaverse Industrial Park is not only a new opportunity in the current era, but also one of the most likely breakthroughs for enterprises to transform in the context of global economic recession.

So, what are the conditions for entering the Metaverse Industrial Park? As an operator of an industrial park, what dimensions should be used to examine whether the settled enterprises are operating legally?Today, Sister Sa’s team will make a detailed analysis for you.

1. How should the Metaverse Industrial Park review the enterprises entering the park?

The Metaverse Industrial Park outlines a digital world full of sci-fi, futuristic, and experiential for people, but dangers may also be hidden in the beautiful picture of the Metaverse. Although the development of the Metaverse industry has a basis for policy support, there are still certain legal risks in the operation of Metaverse-related enterprises. The operators of the Metaverse Industrial Park, which is a gathering of Metaverse enterprises, cannot ignore these “time bombs” in the development of the Metaverse industry.Sister Sa’s team combines the entertainment and consumption scenarios that are widely used in the Metaverse Industrial Park to provide the operators of the Metaverse Industrial Park with some elements that need to be reviewed.

(1) Business Qualification Review

The first thing that the operators of the Metaverse Industrial Park should consider when building the Metaverse World is the administrative license required for the establishment of the Metaverse Industrial Park.The Metaverse industry chain includes extremely complex business types, and different business contents involve different qualification license applications. For example, the application of video game technology in the Metaverse + entertainment scene involves the provision of online game products and services through information networks, and the development of this business requires an application for approval for game publishing operations; in addition, the construction of a digital sales platform in the Metaverse + consumption scene requires It is necessary to obtain the “Network Culture Business License”, “Network Publishing Service License”, and “Information Network Dissemination of Audiovisual Programs License”.

According to the “Regulations on the Management of Blockchain Information Services”, “Regulations on the Management of Online Publishing Services”, “Regulations on the Management of Internet Access Service Business Sites” and other regulations, if the Metaverse Industrial Park and the enterprises in the park start operations without obtaining the corresponding qualifications, they will be subject to supervision by the regulatory authorities. Orders to suspend business for rectification , and fines will be imposed if refusal to make corrections. In serious cases, it may be suspected of the crime of refusing to perform information network security management obligations and illegal fund-raising crimes.

(2) Information and data security

Metaverse Industrial Park is essentially a high-tech industrial park driven by information elements, which may involve the collection and exchange of personal information and the flow of various data elements . Therefore, Metaverse Industrial Park operators face legal risks in the field of information and data security. will also be higher. For example, in the consumption scenario of the industrial park, the digital collection sales platform integrates virtual reality and art consumption, and users need to provide personal identity information and personal financial information when purchasing digital collections, which involves the regulation of personal information processing; in Metaverse + Entertainment In the scenario, the application of virtual wearable devices also needs to collect a large amount of sensitive biological data, including data such as height, weight, expression, fingerprint, etc., which involves data security protection issues.

Once the personal information and data collected in the Metaverse industrial chain are leaked or abused, it will not only have an impact on the entire Metaverse Industrial Park ecosystem, but also lead to legal accountability in the field of information and data security. At present, China’s regulatory agencies take a severe approach to data security violations and crimes . According to the “Personal Information Protection Law”, “Data Security Law”, “Network Security Law” and other relevant regulations, if there is excessive collection of personal information and other illegal processing of personal information, or Data disputes may constitute civil torts or lead to anti-unfair competition cases. Operators of Metaverse Industrial Park may have to bear civil liability, or face severe administrative penalties from regulatory agencies. In serious cases, they will be suspected of infringing on citizens’ personal information. crime.

(3) Financial regulatory risks

With the wave of the Metaverse, the industry is very lively, but there have also been many financial chaos in the application of the Metaverse + consumption scenarios, and financial regulators have issued regulatory guidelines for this many times. In September 2021, ten departments including the People’s Bank of China issued the “Notice on Further Preventing and Disposing of Hype Risks in Virtual Currency Transactions “, emphasizing that virtual currency does not have the same legal status as legal tender, and its related business activities are illegal financial activities.

In February 2022, the China Banking and Insurance Regulatory Commission issued the “Risk Warning on Preventing Illegal Fund Raising in the Name of “Metaverse”, which pointed out that fabricated false Metaverse investment projects, searched under the banner of the Metaverse blockchain game, and maliciously hyped the Metaverse real estate circle. The illegal profit-making of Metaverse virtual currency in disguise with money and disguised form may be suspected of illegal and criminal activities such as the crime of illegally absorbing public deposits and the crime of fraud.

In April 2022, China Internet Finance Association, China Banking Association, and China Securities Association issued the “Initiative on Preventing NFT-Related Financial Risks”, proposing to curb the tendency of NFT financial securitization and strictly prevent the risks of illegal financial activities. The aforementioned legal documents reflect the more stringent management and control attitude of the regulatory agencies and the future direction of supervision. If the operator of the Metaverse Industrial Park is not careful, it is very easy for the Metaverse Industrial Park to become a breeding ground for financial illegal and criminal activities. The park operators themselves will also face legal accountability, so the construction of the financial compliance system of the Metaverse Industrial Park cannot be ignored.

2. How can the Metaverse Industrial Park be stable and far-reaching?

In order to make the future ship of the Metaverse Industrial Park stable and far-reaching, Sister Sa’s team reminds the operators of the Metaverse Industrial Park to pay attention to the following compliance points:

(1) Review the background and qualifications of enterprises in the park 

In order to prevent “landmines” related to illegal and criminal activities from being hidden in the Metaverse Industrial Park, the operators of the Metaverse Industrial Park should strengthen due diligence on the background of the introduced enterprises, and examine whether the introduced enterprises and their executives in the park are involved in fraud, illegal fund-raising, The background and possibility of illegal and criminal activities such as pyramid selling, money laundering, etc., and the core personnel of enterprises in the park are required to provide relevant working background certification materials, certificates of no criminal records, etc., as important due diligence materials. If it is found that the enterprise may be suspected of financial crimes The introduction of the park should be refused.

In addition, the operators of the Metaverse Industrial Park need to conduct self-examination as appropriate according to the actual situation of the park, clarify the business type and content of the industrial park, apply for business qualifications to the relevant competent authorities by category, and ensure that all enterprises in the park have obtained the operation qualification license, so as to realize the realization of Metaverse normal operation of the industrial park.

(2) Strictly supervise the information and data processing process

Based on the fact that the Metaverse Industrial Park will collect a wider range of user information and data, the operator of the Metaverse Industrial Park should strictly supervise the scope of information and data collection and processing procedures in the park. Specifically, Metaverse Industrial Park needs to implement the responsibility for information content security management, and establish and improve management systems such as user registration, information review, emergency response, and security protection.

At the same time, the data processor of Metaverse Industrial Park shall ensure that the data is continuously protected and used legally throughout the entire life cycle of the data, and protect the data from leakage, theft, tampering, damage, loss, and illegal use. In addition, the operators of the Metaverse Industrial Park can establish an external and internal two-way evaluation mechanism, through the combination of external evaluation and self-evaluation, to help enterprises in the park more accurately identify problems in data compliance management, thereby preventing data compliance risk.

(3) Establish a long-term monitoring mechanism

Operators of the Metaverse Industrial Park should pay attention to various legal risks in the Metaverse industry, especially the criminal red line that cannot be crossed. In terms of avoiding legal risks, a supervision and review mechanism is essential. Sister Sa’s team suggested that Metaverse Industrial Park establish a long-term review mechanism for enterprises in the park, so that when enterprises in the park change their service content, they can urge them to file according to the “Regulations on the Management of Blockchain Information Services” and other norms. At the same time, Metaverse operators can also introduce an external supervision mode, set up a convenient complaint and report portal, handle public complaints and reports in a timely manner, and allow the industrial park to accept social supervision.

The operator of the Metaverse Industrial Park can establish a long-term communication mechanism with the leading unit, responsible unit and relevant regulatory authorities, send special personnel to establish a criminal risk reminder, reporting, and feedback mechanism with them, and regularly provide the relevant departments with industrial park enterprise criminal risk review reports to strengthen The supervision of the industrial park itself will realize the self-discipline of the Metaverse Industrial Park while being supervised by the regulatory agency, laying a good foundation for the compliant operation of the Metaverse Industrial Park.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/compliance-issues-in-metaverse-industrial-park/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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