The government has officially allowed foreign companies to manufacture and sell game consoles on the Chinese mainland, as long as they are registered in the China (Shanghai) Pilot Free Trade Zone.

According to a general plan for Shanghai FTZ posted on the official government website on Friday, foreign companies, if they are established in the Shanghai FTZ, can manufacture and promote game console products for the Chinese market.

But before they start selling, foreign gaming companies have to seek approval for specific products from the Ministry of Culture as the government wants to ensure the content is suitable.

Because of fears of the potential harm to the physical and mental development of the young, seven ministries collectively banned the manufacture, sale and import of game consoles in China in 2000.

Major game console vendors across the world, including Microsoft, Nintendo and Sony, made several attempts but failed to find a way to enter the Chinese mainland market officially.

On Monday, Microsoft announced it would set up a joint venture with BesTV New Media Co, a Chinese Internet protocol TV service provider, to develop "next generation family gaming and entertainment products" and offer related services.