TikTok has been handed an ultimatum by the US government: either the Beijing-based owner ByteDance sells its stake in the video-sharing app, or the service will be banned.
The ultimatum, according to The Wall Street JournalThe Wall Street Journal, comes from the Committee on Foreign Investment in the United States (CFIUS), a regulatory arm that reviews the national security implications of foreign investments.
Former President Donald Trump attempted to ban TikTok back in 2020, but ByteDance fought back, went to court, and blocked the proposed federal ban claiming it violated the Berman amendments. It seems the Biden administration will face a similar challenge if a ban is attempted.
TikTok CEO Shou Zi Chew, who is scheduled to testify before the House Energy and Commerce Committee next week, has responded to the ultimatum and pointed out a sale wouldn't resolve the national-security concerns the US government has. He also points to TikTok's existing "Project Texas" five-pillar strategy as the way to protect American users' data and out of the hands of the Chinese government.
"I do welcome feedback on what other risk we are talking about that is not addressed by this [Project Texas]," Chew said. "So far I haven't heard anything that cannot actually be solved by this ... The idea behind Project Texas is it won’t matter what the Chinese law or any law says, because we’re taking U.S. user data and we’re putting it out of their reach."
A statement from TikTok mirrored Chew's response, saying that "a change in ownership would not impose any new restrictions on data flows or access." Rather, the best way to address concerns about national security, a spokesperson explained, "is with the transparent, US-based protection of US user data and systems, with robust third-party monitoring, vetting, and verification, which we are already implementing." That third-party monitoring is being provided by Oracle.
This move by the Committee on Foreign Investment in the US comes amidst pushback from western politicians, including the United Kingdom, which this week became the latest country to block the popular app from government-issued devices. A group of bipartisan US senators recently targeted TikTok with a bill aimed at "foreign threats," including Huawei, Tencent, and Alibaba.
Neither CFIUS nor ByteDance immediately responded to PCMag's request for comment.