News

Trump’s TikTok Sell-By Date Extended By 15 Days

November 13th, 2020

Since July, President Trump has tried to ban Chinese-owned video app TikTok, or force the video-streaming service to sell its U.S. assets to an American company over national security concerns.

AP

Updated at 12:13 p.m. ET

TikTok has, yet again, caught a break. This time, it’s because the Trump administration has failed to enforce a deadline it set for the app to sever ties from its China-based parent company.

Instead, on Friday, the Trump administration gave TikTok 15 more days to find an American buyer.

An order signed by the president in August demanded TikTok’s owner, ByteDance, sell the app to an American company by Thursday, or TikTok would be banned in the U.S. over national security concerns.

But the Thursday deadline came and went, and TikTok did not have a deal in hand. Lawyers for TikTok asked the Trump administration for a 30-day extension. Trump offered a 15-day delay.

It was up to Attorney General William Barr to enforce the president’s order, but that did not happen. A Justice Department spokesperson declined to comment on why the Trump administration appeared to be backing away from its pressure campaign on TikTok.

That means no interruption for the millions of Americans who turn to the app for mostly playful and comedic short-form videos, which have become especially popular during the pandemic.

Federal courts have halted the Trump administration’s prior attempts to force a sale of TikTok, blocking an order that would have both banned all U.S. transactions with TikTok and removed it from app stores. In light of those legal defeats, Trump’s sell-by timeline became virtually toothless.

ByteDance is in talks with Oracle, the software company, and Walmart. The details of the agreement, including how much control the American companies would get over the app, remain under discussion.

TikTok says the White House appears to be asleep at the wheel.

“We have offered detailed solutions to finalize that agreement, but have received no substantive feedback on our extensive data privacy and security framework,” TikTok said in a statement.

Any deal requires the approval of the buyers and regulators in Washington and Beijing.

Winning the blessing of Chinese authorities may not be easy. Chinese state media has called Trump’s crusade against TikTok “daylight robbery.” Furthermore, China’s Ministry of Commerce passed new regulations stating that artificial intelligence technology, like TikTok’s recommendation algorithm, can only be sold after receiving special government approval.

TikTok is the most-downloaded nongaming app in the world. In the U.S., the app has nearly 100 million active monthly users.

How did we get here?

Last October, the Committee on Foreign Investment in the U.S., which investigates the national security risks of certain business deals, began examining ByteDance’s 2017 acquisition of Musical.ly, a Chinese-owned lip-syncing app that became a hit among teens in the U.S. and would be relaunched as TikTok.

The review came at the urging of Sen. Marco Rubio, R-Fla., who wrote a letter to Treasury Secretary Steve Mnuchin raising fears about political censorship and the possibility that the Chinese Communist Party could use the app to advance its foreign policy agenda.

For months, lawyers for TikTok were fulfilling document requests as part of the review and working on a plan to mitigate the committee’s concerns when in early July, the process was “abruptly cut short,” according to attorneys for TikTok.

All of a sudden, Trump was calling for TikTok to be banned entirely from the U.S. and the committee took on a radically different tone, too, threatening to force the company to fully sell off its U.S. assets to an American company.

The Trump administration justified its escalation against TikTok by highlighting growing worries over TikTok’s corporate owner ByteDance having close ties to the Chinese Community Party. That fueled worries in Washington that the country’s authoritarian regime could use TikTok to access Americans’ data.

To TikTok’s legal team, the timing was suspicious, appearing more like retaliation than anything else. That’s because the sudden shift came just weeks after a coordinated TikTok prank. Users on the app helped surge reservations to Trump’s campaign kick-off rally in Tulsa, Okla., leading to the expectation that more than a million people would show up. That led to a major disappointment on behalf of the Trump campaign when about 6,200 people turned out.

Since then, TikTok has dealing with a flood of legal fights with the White House. In court, TikTok has repeatedly won. TikTok lawyers have described Trump’s TikTok crackdown a “political-related animus” intended to portray Trump as being tough on China. And judges have sided with TikTok, pointing out that the Trump administration’s national security case against the app was largely speculative.

A federal judge in Washington blocked an order from Trump that would have removed TikTok from smartphone app stores. Another judge halted a prohibition on U.S. transactions with the app that Trump had sought.

That all but defanged the order from CFIUS for TikTok to divest from ByteDance. Barr has the power “to take any steps necessary” to enforce TikTok being in violation of the order.

Justice Department lawyers have appealed both district court orders enjoining Trump’s prohibitions against TikTok.

As a candidate this summer, Joe Biden made his campaign staff delete TikTok from their phones. Biden has called the app “a matter of genuine concern,” though tech policy experts believe he will be less antagonistic than Trump, choosing instead to negotiate over data privacy and other concerns.