Trump to reportedly order TikTok's owner, ByteDance, to sell its US operations
Donald Trumpis planning to sign an order directing ByteDance, TikTok's parent company, to "divest its ownership" in the app's US operations, Bloomberg reported on Friday.
- A Fox Business journalist also reported that Microsoft was interested in buying TikTok's US operations.
- It's unclear what power Trump has to order a foreign company to sell a part of its business.
President Donald Trump is set to order TikTok's Chinese parent company to sell the app's US operations, Bloomberg reported on Friday.
Trump is planning to sign an order directing ByteDance to "divest its ownership" of TikTok in the US, the report said. Earlier this month, the Trump administration first said publicly that it was considering banning TikTok over concerns about its ties to
Trump has the power to intervene in corporate deals under a 1988 law, according to The Wall Street Journal. Trump has twice used this authority to block deals in which tech companies from China and Singapore were poised to take over American competitors.Microsoft did not immediately respond to Business Insider's request for comment. In a statement to Business Insider, a TikTok representative said that the company did not comment "on rumors or speculation" and that it was "confident in the long-term success of TikTok."
"Hundreds of millions of people come to TikTok for entertainment and connection, including our community of creators and artists who are building livelihoods from the platform," TikTok said in its statement. "We're motivated by their passion and creativity, and committed to protecting their privacy and safety as we continue working to bring joy to families and meaningful careers to those who create on our platform."It's unclear how TikTok or ByteDance will respond to an order, but Trump's move would represent an escalation in the administration's attacks on TikTok and other Chinese tech companies. Since TikTok came to the US in 2018 and found an energetic and growing base of as many as 80 million users, there have been questions about the amount of access and influence the Chinese government is afforded over TikTok's user data and content moderation through its parent company, ByteDance.
In late 2019, the Committee on Foreign Investment in the United States launched a national-security investigation into ByteDance's 2017 acquisition of Musical.ly, a short-form video-editing app already popular in the US that preceded TikTok's expansion to American users. CFIUS reviews foreign companies' deals involving US businesses for national-security risks.
But TikTok's China ties have attracted more attention in recent months as the president and administration officials have said they're weighing a ban on the app. Trump has said a ban would be a way to punish China over its role in the coronavirus pandemic, while Secretary of State Mike Pompeo cited national-security concerns.As part of its efforts to demonstrate its distance from China, TikTok named a new CEO in June: Kevin Mayer, a longtime Disney executive based in TikTok's US headquarters in Los Angeles. The company also recently launched a content-advisory council to guide policy changes and set up a transparency center at its Los Angeles offices.
But as uncertainty about TikTok's future persists, ByteDance executives and investors have reportedly been exploring ways to avoid an app ban in the US. One possibility, raised by the White House economic adviser Larry Kudlow earlier this month, could see TikTok pull out of China and operate as an "independent American company."
Some of ByteDance's US investors, including Sequoia Capital, have been looking into buying a majority stake in the app, according to The Information. The group of investors has valued TikTok, which has more than 2.3 billion downloads worldwide, at a whopping $50 billion.
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