I don't think this is something that needs regulation. The capitalist solutions of boycotts and protests seems to be sending a pretty strong signal to blizzard.

At the end of the day, while china is a huge market, it isn't the whole market.

That does mean, however, if you think that Blizzard's actions are immoral, then vote with your wallet. This doesn't work in every case (particularly where companies have practical monopolies on essential goods and services), but at the end of the day, Blizzard is a company that peddles luxury products.