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  • April 21, 2024 - TikTok

April 21, 2024 - TikTok

The future of TikTok's presence in the U.S. is in question as the government addresses national security concerns over the app's Chinese ownership. On Saturday, The House of Representatives passed a measure that could potentially ban TikTok if its China-based parent company, ByteDance, fails to sell its stake within a year. This bill, fast-tracked as part of a larger foreign aid package, reflects growing bipartisan concerns among lawmakers about the potential risks posed by TikTok's ties to China.

Both Democrats and Republicans, along with intelligence officials, have voiced concerns that Chinese authorities could compel ByteDance to hand over American user data or manipulate the app's influential algorithm to promote content aligned with Chinese government interests. All of this occurring in the context of the upcoming U.S. presidential election. However, TikTok has consistently denied these allegations, maintaining that it has not shared U.S. user data with Chinese authorities. The U.S. government has already taken steps to limit the app's use on government devices, with several states and the federal government imposing TikTok bans on official devices. In December 2021, a federal judge ruled in favor of Texas' ban. 

TikTok is not the only Chinese tech company facing scrutiny for alleged ties to the Chinese government and military. In recent years, companies like Huawei, a China-based telecommunications equipment manufacturer, have been at the center of long-standing controversies. The Trump administration had also attempted to ban TikTok and WeChat in 2020, citing national security risks, although the bans were ultimately blocked by federal courts.

If the current bill becomes law, ByteDance will face a difficult decision: sell TikTok to a U.S. buyer approved by the government within six months or risk losing access to the lucrative American market. However, even if ByteDance agrees to divest, the sale process is fraught with challenges. Potential buyers would need deep pockets to afford TikTok's multi-billion-dollar price tag, and any deal with a major tech company could face antitrust scrutiny. Moreover, the Chinese government, which has stated its opposition to a forced sale, would need to sign off on the deal.

Legal experts have suggested that ByteDance might need to consider selling TikTok's entire global business or isolating its U.S. operations to comply with the bill's conditions. Under the legislation, ByteDance would be prohibited from retaining any connection to the app or control over its algorithm post-sale, and the president would need to approve the sale, confirming that it meets the stated requirements. Even if a sale is successfully negotiated, concerns about data privacy and security risks may persist. Some cybersecurity experts argue that a new U.S. owner could still potentially transfer user data to the Chinese government, and ensuring legitimate access to TikTok's data would be a difficult task.

While TikTok is not the only social media platform facing scrutiny over data privacy and security, its Chinese ownership and the Chinese government's ability to demand data from companies have made it a particular target of concern. As policymakers grapple with the complex issues surrounding TikTok and other Chinese tech companies, the future of these firms in the U.S. market remains uncertain. The TikTok saga, along with the experiences of other Chinese tech companies, may set a precedent for how the government approaches perceived national security risks posed by foreign-owned firms operating in the U.S.