Washington: The US government says TikTok should be sold or else face a possible ban in the country.
The video-sharing app, owned by Chinese company ByteDance, is accused of posing a national security risk through data gathered from millions of users.
The company said a forced sale would not change its data flows or access.
The Treasury Department is leading the discussion though the Committee on Foreign Investment in the US, or Cfius, and made the demand to Tiktok’s owner, ByteDance Ltd., recently, the people said. They asked not to be identified discussing private deliberations.
TikTok’s leadership has been discussing the possibility of separating from ByteDance Ltd., its Chinese parent, to help address concerns about national security risks, Bloomberg News reported on Tuesday. One person said TikTok’s owners could retain some form of ownership but through a passive structure.
“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,” TikTok spokeswoman Maureen Shanahan said in a statement. “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, which we are already implementing.”
The company, which is undergoing a national security review by Cfius, agreed last year to implement a number of changes in a plan it calls Project Texas. The proposal includes bringing in American tech giant Oracle Corp. to host US user data and review its software, and appointing a three-person government-approved oversight board. Many of the moves are already under way.
The administration was unconvinced by TikTok’s proposal to add layers of oversight and separation from ByteDance, according to another person familiar with the matter. TikTok has poured $1.5 billion into Project Texas, but the details have been met with skepticism on Capitol Hill as well.
The move marks a major escalation by the administration in the US relationship with China at a time when the two countries are already clashing over issues ranging from the fate of Taiwan to export controls of microchips to China’s strengthening partnership with Russia.
