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US Demands TikTok’s Chinese Owners Divest Stakes or Face Possible U.S. Ban

The popular video app TikTok, owned by Chinese tech company ByteDance, has been under scrutiny from U.S. officials and legislators due to concerns that the app’s user data could be shared with the Chinese government. In a dramatic move, the Biden administration has demanded that ByteDance divest its stakes in the app or risk a U.S. ban.

TikTok has become a cultural phenomenon, with over 1 Billion users worldwide and 100 million U.S. users who use the app to create and share short-form videos. However, the app’s ownership by a Chinese company has raised concerns about the security and privacy of user data. U.S. officials worry that the Chinese government could use TikTok to gather sensitive information about American citizens. These concerns about spying have resulted in countries like the UK, Canada, and Australia recently moving to ban the app from government phones.

The demand for ByteDance to divest its stakes in the app comes after a series of recent steps by U.S. officials and legislators to address these concerns. Last month the US government issued a directive that all government agencies should ensure they do not have TikTok on any federal devices or systems. They were given 30 days to comply. Similarly, over 30 states in the country have banned employees from using the app on government-owned devices. However, this is the first time that the Biden administration is threatening a nationwide ban.

Confirming the issue, TikTok spokesperson Brooke Oberwetter said that the company had recently heard from the US Treasury-led committee on foreign investment in the United States (CFIUS), which demanded that the Chinese owners of the app sell their shares, and said otherwise they would face a possible US ban of the video app.

“If protecting national security is the objective, divestment doesn’t solve the problem: a change in ownership would not impose any new restrictions on data flows or access. The best way to address concerns about national security is with the transparent, U.S.-based protection of U.S. user data and systems, with robust third-party monitoring, vetting, and verification.”

TikTok spokesperson, Brooke Oberwetter

This is not the first time that CFIUS is recommending ByteDance divest Tiktok. In 2020, the agency made the same recommendations. The then president Donald Trump moved to ban the app but was blocked by US courts.

This time, the threat of a US ban came on the back of TikTok restriction talks across the globe. News of the Chinese spy balloon that was found hovering over the US only served to escalate these restrictions. The spy balloon scandal prompted a US congressional committee to move forward with legislation that would empower the U.S. president to ban the app and any other foreign-based technologies that may pose national security threats.

While the future of TikTok in the U.S. remains uncertain, one thing is clear: the app’s Chinese ownership has put it at the center of a geopolitical battle between the U.S. and China. As tensions between the two countries continue to escalate, the fate of TikTok could have far-reaching implications for the future of tech and data privacy.

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