TikTok has been threatened with a federal ban unless Chinese owner ByteDance sells its stake in the popular short video app, the company said on Thursday.
The United States Committee on Foreign Investments (CFIUS), the interagency body that reviews foreign investments that affect national security, has called for the sale of the Beijing-based app maker, Brooke Oberwetter, spokeswoman for TikTok, told multiple news outlets.
CFIUS and TikTok had been discussing a potential mitigation deal for two years to allow the world’s most downloadable app to continue its US operations in 2022 while addressing privacy concerns. That window began to close quickly in recent weeks as Congress stepped up its scrutiny of the social media platform and prepared to give the White House more powers to enforce controls.
“If protecting national security is the goal, divestment does not solve the problem: a change in ownership would not introduce new restrictions on data flow or access,” Oberwetter said.
“The best way to address national security concerns is transparent, US-based protection of US user data and systems with robust third-party monitoring, review and verification,” she said.
TikTok’s press office has not responded to an emailed question about the possibility of a national security deal with CFIUS.
To meet conditions to reduce the risk of data exposure — more than 100 million Americans have the app on their phones — such a deal would inevitably see the company relinquish some level of control on behalf of regulators. But it could also involve sharing sensitive details like its algorithm.
The White House responded news week‘s email asking for confirmation of the new sales push, first reported by on Wednesday The Wall Street Journal, with reference to the CFIUS, the news week also got in touch via email. The precedent set by such a move could have unpredictable repercussions for US companies worldwide, and it remained unclear how many American firms could even afford to acquire TikTok.
TikTok has long said it operates independently from ByteDance, the developer behind its Chinese equivalent Douyin, which itself had over 700 million monthly active users as of late 2022.
Its CEO, Shou Zi Chew, is scheduled to testify in Congress next week before the House Energy and Trade Committee. The company claims it has never disclosed user information to Chinese authorities and would not do so if asked. US government officials argue they may not have a choice.
“The difference between the private sector and the public sector — that’s a line that doesn’t exist in the workings of the CCP,” FBI Director Christopher Wray said at a March 8 congressional hearing, referring to China’s long-ruling Communist Party.
“Data is the coin of the empire,” Wray told the Senate Intelligence Committee. “Those who have the best information have the power, and that allows them to do that.”
“This is a tool that is ultimately under the control of the Chinese government, and to me it screams national security concerns,” he added.
TikTok’s capabilities are limited and it’s struggling to find enough open ears on Capitol Hill. The White House has already backed a bipartisan bill that, if passed, could immediately review the company on national security grounds.
The legislation, aimed at banning high-risk foreign technology, would place TikTok in the hands of the US Department of Commerce, which deals with restrictions and sanctions.
TikTok could move its operations abroad or fight a future federal ban for legal reasons. US courts threw out the Trump administration’s attempt to restrict the app in 2020.
The US, Canada and the European Union have already announced TikTok restrictions on government devices. The UK announced Thursday it would ban the app from government phones.
China officials say concerns about TikTok — the country’s only globally successful software — boil down to paranoia.
“The US should stop spreading disinformation about data security, end its unreasonable repression of the offending company, and create an open, fair, just and non-discriminatory business environment for companies of all countries to invest and operate in the US,” Wang Wenbin, a spokesman for China’s Foreign Ministry, said on Thursday.
Do you have a tip on a world news story that news week should cover? Do you have a question about TikTok? Let us know at worldnews@latestpagenews.com.
