U.S. officials have demanded from the Chinese Bytedance to sell assets related to the service TikTok, which it owns, under the threat of a ban on the social network in the United States. This was reported by Bloomberg, citing sources.
The White House is concerned about the security of U.S. citizens' data and the influence of Chinese authorities through TikTok. The demand to sell TikTok recalls the position of former President Donald Trump, who threatened to ban TikTok unless it was sold to an American company.
TikTok said it was disappointed by the U.S. authorities' decision. Under the Cfius security review, the company agreed last year to implement a number of changes in a plan. The plan, called Project Texas, includes bringing in American technology giant Oracle Corp. to host the infrastructure of the U.S. segment of the social network, and appointing a three-person government-approved oversight board.
TikTok has poured $1.5 billion into Project Texas, but the U.S. administration was reportedly skeptical of the idea of additional oversight from Bytedance.
According to Bloomberg, TikTok’s leadership has been discussing the possibility of separating from ByteDance Ltd., its Chinese parent, only if all other steps to ensure U.S. national security are not recognized by the American side.
In December 2022, the U.S. Senate approved a bill to ban government employees from downloading TikTok to government devices. On 1 March, the U.S. House Committee on Foreign Affairs approved a bill which gives the president the right to impose a ban on TikTok in the country. The lawmakers explained the need for blocking by the fact that the social network could be used in its interests by the Communist Party of China (CPC).
TikTok, with 100 million U.S. users, is at the center of a battle between the Biden administration and the Chinese government over tech and economic leadership, as well as national security. President Biden has waged a broad campaign against China with enormous funding programs to increase domestic production of semiconductors, electric vehicles and lithium batteries. The administration has also banned Chinese telecommunications equipment and restricted U.S. exports of chip-manufacturing equipment to China.
TikTok Chief Executive Officer Shou Chew has been asked to testify before a House committee next week about the app’s data privacy and security practices, and the company’s relationship with the Chinese Communist Party.