U.S. Sets Ultimatum for TikTok to Sever Ties with Chinese Parent Company ByteDance

The U.S. Senate has passed legislation that mandates the popular short-video app TikTok to dissociate from its Chinese parent company, ByteDance. This decision now moves to President Joe Biden’s desk, who has indicated he will sign it into law. ByteDance will have a maximum of one year to divest from TikTok, or face the app being banned from U.S. app stores. The viability of this legislation in U.S. courts remains uncertain, following the failure of a similar ban previously.

The bill was passed in the Senate by a significant majority of 79 to 18 votes late last night. ByteDance is widely viewed by U.S. lawmakers across party lines as a company that must comply with the directives of the Chinese Communist Party. There are concerns that Chinese authorities could potentially access vast amounts of data from U.S. users and use the platform for political influence, allegations that TikTok has consistently denied. “For years, we allowed the Chinese Communist Party to control one of America’s most popular apps, and that was dangerously shortsighted,” said Senator Marco Rubio, the leading Republican on the Intelligence Committee. “This new law will force the Chinese owner to sell the app, which is good for America.”

This legislation, recently passed by the House of Representatives for the second time, is now part of a package that also enables new aid for Ukraine amid Russian aggression. This addition expedited its passage through the Senate on the second attempt.

Caught in a Dilemma: Biden’s Democrats face a tricky situation with the bill. While the President aims to adopt a strong stance against China, TikTok remains popular among young users, whose votes are crucial for Biden’s reelection in November. Biden’s campaign team even launched a TikTok account earlier this year. TikTok maintains that it does not view itself as a subsidiary of a Chinese company, stating that ByteDance is 60% owned by Western investors and headquartered in the Cayman Islands in the Caribbean. However, U.S. politicians counter that the Chinese founders retain control with a 20% stake and enhanced voting rights, and ByteDance’s main office remains in Beijing, subject to governmental influence.

Following the Senate vote, TikTok has not yet commented, but the company had previously announced plans to legally challenge the legislation.