President Biden is anticipated to sign legislation mandating that TikTok’s Chinese owner divest the social media app’s U.S. operations or face a ban once it is passed by the Senate.
Biden has affirmed his intention to sign the bill, which is part of a foreign aid package for Ukraine, Israel, and Taiwan.
Below is an overview of the bill and its implications.
How does the law enable sales or bans?
The legislation gives TikTok’s parent company, Dance Corp. based in Beijing, 270 days to sell the app’s U.S. operations. Upon nearing the deadline, the president can grant a 90-day extension if ByteDance is near finalizing the deal. If the bill passes this week, the deadline coincides with the presidential inauguration on January 20th. This means that the decision to extend the sale process may rest with Donald Trump depending on the election outcome.
Joe Biden previously said he intended to sign the bill. Photo: Anadolu/Getty Images
Failure by ByteDance to complete any sales would result in a nationwide ban by restricting app stores and web hosts from distributing TikTok.
Why is the US considering banning TikTok?
US lawmakers and authorities are worried about the possibility of the Chinese government accessing the data of TikTok’s 170 million American users under national security laws. Director of the FBI, Christopher Wray, stated that ByteDance is “influenced by the Chinese government” and Chinese officials manipulated TikTok’s algorithms. He cautioned that this could jeopardize individuals and allow governments to gather user data for espionage purposes.
TikTok refutes allegations of the Chinese government attempting to access U.S. user data and asserts denial of such requests. During a congressional hearing last year, TikTok’s CEO, Shou Zhi Chu, clarified: “ByteDance does not operate in China or any other country.”
Will TikTok challenge this legislation?
TikTok has pledged to contest the bill in court post its enactment, arguing that it violates the First Amendment safeguarding free speech.
“After the bill becomes law, we plan to file a legal challenge in court,” stated Michael Beckerman, TikTok’s head of public policy for the Americas, in a weekend memo to staff. He emphasized: “We will persist in opposing this bill as it infringes upon the First Amendment rights of the 170 million American TikTok users.”
The favorable tilt towards TikTok from the First Amendment was evident when a judge in Montana who previously banned the app overturned the decision, citing violation of users’ free speech rights.
View of Beijing, China. TikTok denies that the Chinese government has tried to access U.S. user data and says it rejects all such requests. Photo: Sean Pavone/Alamy
In 2020, the U.S. attempted to ban TikTok following an executive order from President Trump, but a Washington judge blocked the ban, citing potential legal overreach. TikTok is expected to seek another injunction before challenging the constitutionality of the bill through a comprehensive lawsuit.
Who could potentially acquire TikTok’s U.S. operations?
Former U.S. Treasury Secretary Steve Mnuchin announced in March his intention to form a consortium to acquire TikTok’s U.S. assets, lauding it as a “promising investment.”
Microsoft had considered a deal to purchase TikTok in 2020 at the urging of President Trump. Additionally, President Trump advocated for U.S. tech company Oracle and retailer Walmart to acquire significant stakes in the company. ByteDance itself has several U.S. investors, including investment firms General Atlantic, Susquehanna, and Sequoia Capital.
Financial analysts at Wedbush Securities anticipate challenges in securing a sale involving TikTok’s algorithm, a crucial technology influencing app content curation. They emphasize the complexity of the sales process without the algorithm’s inclusion.
If ByteDance fails to make the sale, it could face a nationwide ban by blocking app stores and web hosts from distributing TikTok. Photo: Sheldon Cooper/SOPA Images/Rex/Shutterstock
What is the stance of the Chinese government?
Last year, the Chinese government expressed strong opposition to the app’s sale, stating that it would undermine global investor confidence in the U.S., including China. China’s export regulations also restrict the sale of specific technologies.
Will other nations replicate this divestment or ban?
TikTok faces scrutiny in other Western countries due to data concerns. It is prohibited on government-issued mobile devices in the UK, US, Canada, and New Zealand. Employees of the European Commission are also forbidden from using it on work-provided devices.
Calls for banning TikTok in the UK have been made, with former Conservative Party leader Iain Duncan Smith stating: “We should have done it ourselves.”
In 2020, India banned TikTok and numerous other Chinese apps, citing threats to national sovereignty, defense, and security.
Source: www.theguardian.com
