TikTok Proposed Sale to Get U.S. Government Review Amid App Ban Threat

China’s ByteDance submitted a revised proposal related to the sale of TikTok to U.S. buyers to the Trump administration, which said it has extended its deadline for the divestment until Dec. 4.

President Trump previously ordered Beijing-based ByteDance to sell TikTok to American buyers by Nov. 12, alleging that the short-form video app represents a national security threat from the Chinese government. That was extended to Nov. 27 and, with the Thanksgiving holiday, pushed for another week to Dec. 4.

If the Trump administration rejects the proposed deal involving TikTok, the app could be effectively banned by the U.S. At the same time, however, ByteDance and TikTok are pursuing litigation seeking to halt such a ban.

“The Committee on Foreign Investment in the United States (CFIUS) has granted ByteDance a one-week extension, from November 27, 2020 to December 4, 2020 to allow time to review a revised submission that the Committee recently received,” a Treasury Department spokesperson said Wednesday. CFIUS is an interagency group led by the Treasury Department that has the authority to block foreign transactions involving U.S. entities.

It’s not clear what ByteDance’s “revised submission” for the divestment of TikTok included. Reps for TikTok did not respond to a request for more information.

Meanwhile, if the pending litigation from ByteDance/TikTok challenging the Trump orders drags into next year, the whole issue could become moot if the administration of president-elect Joe Biden decides to abandon the forced sale of TikTok.

TikTok, which claims it has more than 100 million U.S. users, has been seeking an injunction to block the shutdown in a case in Washington, D.C. On Oct. 30, a U.S. district judge in Philadelphia issued an injunction temporarily blocking the download ban, granting a request from three TikTok creators who argued that the shutdown would infringe their First Amendment rights. The Department of Justice has appealed the ruling.

In its legal filings, TikTok has argued that Trump relied on “anti-Chinese rhetoric” during his unsuccessful re-election campaign, and that the idea of banning the app came about after TikTok users boasted of entering bogus orders for tickets to Trump’s rally in Tulsa, Okla., in June so that it would look like turnout would be much greater than it actually turned out to be.

In a Nov. 10 petition filed with the U.S. Court of Appeals for the D.C. Circuit, ByteDance and TikTok asked the court to “hold unlawful, vacate, enjoin and set aside the Divestment Order and the CFIUS Action, and grant any further relief that may be appropriate.” The companies said they intend to file a motion to stay enforcement of Trump’s divestment order “only if discussions reach an impasse and the government indicates an intent to take action to enforce the Order.”

It’s been more than two months since Trump gave provisional approval for ByteDance to sell the app to Oracle, Walmart and other U.S.-based investors. After that, according to TikTok, it heard nothing from the Trump administration regarding the proposed deal, including receiving “no substantive feedback on our extensive data privacy and security framework.”

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