The Biden administration is giving TikTok’s parent company, ByteDance, an ultimatum — sell its stake in the U.S. business or face a potential ban, according to the company.
TikTok received this instruction in recent weeks, according to The New York Times.
The latest development shows the White House has shifted its position on the company. In 2021, President Biden revoked former President Trump’s executive order to ban TikTok and WeChat in the United States over concerns about national security, according to the BBC.
The Trump administration reportedly reached a deal for ByteDance to sell its U.S. segment to Oracle and Walmart, but the deal did not take shape, according to The Wall Street Journal.
TikTok and the Committee on Foreign Investment in the United States (CFIUS) continued talks that would enable the app to operate in the U.S., per CNN. The company submitted a $1.5 billion restructuring agreement, which TikTok called Project Texas, in August, according to Texas Monthly.
TikTok says it has yet to hear back regarding that offer, according to the NYT.
The Biden administration has now reversed course and appears to be picking up former President Trump’s threats to ban TikTok unless it is sold to an American company, according to NPR.
TikTok says it is disappointed by the decision and is considering its options, NPR reports.
“If protecting national security is the objective, divestment doesn’t solve the problem: a change in ownership would not impose any new restrictions on data flows or access. The best way to address concerns about national security is with the transparent, U.S.-based protection of U.S. user data and systems, with robust third-party monitoring, vetting, and verification, which we are already implementing.” TikTok spokeswoman Maureen Shanahan told The Dallas Express.
Shanahan also pointed to a report from Georgia Tech’s Internet Governance Project, which claims, “The data collected by TikTok can only be of espionage value if it comes from users who are intimately connected to national security functions and use the app in ways that expose sensitive information. These risks arise from the use of any social media app, not just TikTok, and cannot be mitigated by arbitrarily banning one app.“
TikTok CEO Shou Zi Chew will testify before the House Energy and Commerce Committee next week and is expected to face pressing questions surrounding his company’s ties with China and the content it promotes, according to the NYT.
Brendan Carr, a Republican on the Federal Communications Commission, said Biden’s new demand is a good sign.
“There is bipartisan consensus that we can’t compromise on U.S. national security when it comes to TikTok, and so I hope the CFIUS review now quickly concludes in a manner that safeguards U. S. interests,” Carr said, per the NYT.
Banning an app remains a practical and legal challenge as federal courts ruled against former President Trump’s attempt to block TikTok from Apple and Google’s app stores, according to CNN.
