The regulation, which is open for public comments until May 10, is seen as a booster for the booming AI sector in China, observers said.

It propels the development of the industry, while it also ensures that progress on the significant but double-edged tool won't be derailed amid rising global concerns.

China supports the independent innovation, popularization and application and international cooperation of basic technologies such as AI algorithms and frameworks. It also encourages the priority use of safe and reliable software, tools, computing and data resources, the Cyberspace Administration of China (CAC) said in the draft regulation published on its website.

Regulations are made to "promote the healthy development and standardized application of generative AI," said the CAC.

According to the draft rules, operators are asked to report to regulators for safety reviews before providing such services to the public, and are urged not to use advantages like algorithms, data and platforms to engage in unfair competition.

The CAC also lays out the ground rules that generative AI services have to follow, including the type of content these products are allowed to generate, saying that companies should ensure the accuracy of information and not generate false information.

It is necessary to introduce this management framework at the moment, as more domestic firms are launching such services, while risks such as data leaks, monopolies and ethical problems are on the rise, Wang Peng, a research fellow at the Beijing Academy of Social Sciences, told the Global Times on Tuesday.

The regulation will clearly guide the way the ahead and boost the development AI in China, Wang said.

Also on Tuesday, Chinese e-commerce giant Alibaba said that all its products and platforms, including the widely used e-commerce platforms Tmall and Taobao, enterprise communication platform DingTalk, and video platform Youku, will be connected to its ChatGPT-like Tongyi Qianwen AI chatbot.

Besides, Tencent has been developing a ChatGPT-like chatbot, which will be integrated into the application of services including QQ and WeChat, Tang Daosheng, a senior executive vice president of Tencent, told thepaper.cn on March 30. 

Baidu in February launched its chatbot called "Wenxin Yiyan" in Chinese and "ERNIE Bot" in English.

Liu Dingding, a Beijing-based tech industry observer, told the Global Times on Tuesday that the draft regulation is a relatively new one on the global scene, which can prevent the industry from being derailed as global concerns over the technology have been rising.

According to the Wall Street Journal, the Biden administration has begun examining whether checks need to be placed on AI tools such as ChatGPT. In a first step toward potential regulation, the Commerce Department on Tuesday put out a formal public request for comment on what it called accountability measures, including whether potentially risky new AI models should go through a certification process before they are released.  

Making rules is a prerequisite for promoting the development of the industry in China, Pan Helin, the joint director of the Research Center for Digital Economics and Financial Innovation affiliated with Zhejiang University's International Business School, told the Global Times on Tuesday, while stressing the significance of "striking a balance between development and regulation as AIGC will be a major science focus for the future development."

Wang said that the draft rule is just a preliminary version that will be optimized in response to public comments and standards, training systems, laws and regulations will follow.

The Payment & Clearing Association of China on Monday called on industry practitioners to use AI generated chatbot tools like ChatGPT "cautiously" after some in the industry have begun to use similar tools in their work.

A-share listed AI concept stocks closed up 4.58 percent on Tuesday, with COL Digital Publishing rising 20 percent to 26.52 yuan ($3.85). The ChatGPT sector edged up 3.72 percent on Tuesday's closing.

Editor: Xiao Da