President Donald Trump issued an executive order Thursday barring U.S. companies from doing business with ByteDance, the Chinese parent company of TikTok.
The order, which is set to go into effect in 45 days, would be a major blow to the popular short-form video app if it is not sold to a U.S. company. Microsoft has been in talks to buy TikTok’s U.S. operations and said last week that it would complete the discussions by Sept. 15.
The order says the risks posed by the platform are “real” and constitute a “national emergency.” The app is reported to have been downloaded 175 million times, capturing “vast swaths” of information that “threatens to allow” Chinese government officials to track Americans, according to the order.
After 45 days, the order says, the Commerce Department will be charged with identifying unspecified “transactions” that violate the ban.
On Friday, TikTok issued a statement saying the company was “shocked” by the order, which it said was “issued without any due process” and “risks undermining global businesses’ trust in the United States.”
“For nearly a year, we have sought to engage with the U.S. government in good faith to provide a constructive solution to the concerns that have been expressed,” TikTok said. “What we encountered instead was that the Administration paid no attention to facts, dictated terms of an agreement without going through standard legal processes, and tried to insert itself into negotiations between private businesses.”
A spokesperson for Microsoft said Thursday night that the company had no comment on the order.
Trump also issued a similar executive order Thursday targeting Tencent, one of the largest Chinese tech companies. While most of Tencent’s business is in China, it has numerous U.S. investments, including ownership of Riot Games, which makes the popular “League of Legends” online game.
Cybersecurity experts have warned that China’s laws allow its government to put pressure on tech companies like ByteDance to provide access to user data. But experts have also said there is no evidence thus far of the company’s providing the Chinese government with data, and they have pointed out that many other companies track their users.
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“While TikTok is being singled out in this executive order, their data collection and sharing practices are fairly standard in the industry,” said Kirsten Martin, a professor of technology ethics at the University of Notre Dame’s Mendoza College of Business.
“I would imagine every teenager will still access TikTok through the VPN they use to access other content. The coronavirus is a national emergency. TikTok is not a national emergency,” she said.
TikTok’s meteoric rise in recent years coincided with increasing tension between the U.S. and China over the growing influence of both countries’ technology companies. TikTok was first mentioned as a national security threat in November when the U.S. government opened a review of the app.
More recently, the White House began targeting TikTok, with Secretary of State Mike Pompeo saying last month that the U.S. was “looking at” banning the app. Trump has since threatened numerous times to ban it.
Thursday’s orders were not the first to target Chinese technology companies. In May 2019, Trump issued a similar order against another major Chinese tech company, Huawei, which makes telecommunications equipment, including 5G wireless infrastructure.
TikTok has maintained that it operates without influence from the Chinese government and that it stores U.S. user data in the U.S. and in Singapore.
Reuters contributed to this report.
Ezra Kaplan contributed.
