China's Kuaishou says state broadcaster has no veto rights over business

BEIJING (Reuters) -Chinese short video apps operator Kuaishou on Wednesday dismissed as untrue what it called "online rumours" that a state broadcaster would be able to veto its business decisions after taking a stake in its Beijing subsidiary.

The company said state-owned broadcaster the Beijing Radio and Television Station (BRTS) had taken an equity stake in one of its Chinese entities and the deal did not affect the parent company.

The Beijing subsidiary was cooperating with the state broadcaster on content-related matters, Kuaishou said.

Chinese regulators have been tightening their oversight of online content and the platforms that show them.

On Sunday, the U.S. tech publication the Information reported that the state broadcaster's recent acquisition of an equity stake in Kuaishou's domestic business reflected the growing influence of the Chinese state over its tech sector.

BRTS's 1% stake in Kuaishou's Beijing subsidiary was registered on Oct. 26, based on business registration information. On the same day, a former executive of a BRTS subsidiary, Shi Yesen, formally gained a board seat at the Kuaishou subsidiary.

Having BRTS' stake will be helpful for Kuaishou when the time comes for it to renew its license to show online visual and audio programmes, which is issued by the National Radio and Television Administration, a source familiar with the situation said, declining to be named as the information is private.

BRTS did not immediately respond to a request for comment.

This is not the first state investment in Kuaishou.

The China Internet Investment Fund (CIIF), which was established by the finance ministry and the Cyberspace Administration of China (CAC), the main internet watchdog, holds around a 1% stake in Kuaishou's Cayman-incorporated entity, based on Kuaishou's prospectus.

CIIF and its affiliates have been active in investing in Chinese internet giants.

A CIIF-backed entity called WangTouZhongWen (Beijing) Technology took a 1% stake and a board seat in a key ByteDance China entity last year. Another CIIF subsidiary, WangTouTongDa, similarly holds a 1% stake in a key subsidiary of the Weibo social media platform, based on government data.

(Reporting by Yingzhi Yang and Brenda Goh; Editing by Clarence Fernandez, Robert Birsel and Jane Merriman)