The Biden administration is urging TikTok’s Chinese owners to spin off their stake or face a US ban



CNN

The Biden administration has threatened to ban TikTok from the United States unless the app’s Chinese owners agree to spin off their stake in the social media platform, TikTok confirmed Wednesday night.

The apparent ultimatum from a US interagency body known as the Committee on Foreign Investment in the United States (CFIUS) marks a possible turning point in long-running negotiations between federal officials worried about TikTok’s ties to China and a Hugely popular social media company with more than 100 million US users.

The latest divestment request was first reported by the Wall Street Journal on Wednesday; TikTok later confirmed to CNN that CFIUS had contacted the company, adding that it did not dispute the journal’s report. However, TikTok declined to discuss details of the U.S. government’s request, including timing details.

“If protecting national security is the goal, the divestment doesn’t solve the problem,” TikTok spokeswoman Maureen Shanahan said in a statement. “A change in ownership would not impose any new restrictions on data flow or access. The best way to address national security concerns is transparent, US-based protection of US user data and systems with robust third-party monitoring, screening, and verification that we already implement.”

TikTok has been negotiating with CFIUS — a group made up of the Departments of Finance, Justice, Homeland Security, Defense and Commerce, among others — for more than two years over a deal that could allow the app to expand further in the US market to operate in the face of security and privacy concerns. US officials have expressed fears that the Chinese government could use its national security laws to pressure TikTok or its Chinese parent company ByteDance into handing out the personal information of TikTok’s US users, which could then benefit Chinese intelligence activities or influence campaigns .

The Treasury Department, which chairs the CFIUS, declined to comment.

Talks with TikTok have dragged on with no resolution, leading to criticism of the Biden administration from some US lawmakers who have pushed for legislation to ban the app.

Late last year, Congress passed and President Joe Biden signed legislation blocking TikTok for US government devices, following in the footsteps of numerous state governments. Since then, the European Union and Canada have also followed suit, reflecting Western governments’ growing distrust of TikTok. So far, however, there is no evidence that the Chinese government has actually accessed TikTok user data, and no government has issued a broader ban on TikTok on personal devices.

TikTok has attempted to address policymakers’ concerns with voluntary technical and bureaucratic safeguards that it says will help ensure only US employees can access US user data. Part of this initiative, which the company calls Project Texas, is the storage of personal data at US cloud giant Oracle. TikTok launched a similar push in Europe this month, which it’s calling Project Clover.

That didn’t stop TikTok’s US critics. Some U.S. lawmakers have sought to expand Biden’s power to impose a nationwide TikTok ban on top of U.S. government device restrictions and independently of the CFIUS process — a proposal the White House was quick to embrace. The heat is likely to intensify next week as TikTok CEO Shou Chew is expected to be grilled before the House Energy and Commerce Committee.

Wednesday’s development suggests there has been a shift in the typically opaque CFIUS talks, although the exact nature of the move remains unclear, according to Harry Broadman, a former CFIUS official.

“It could be that the divestment request is the end of the discussion, but it’s just as likely that the divestiture is a component of what CFIUS wants in terms of safeguarding national security,” Broadman said. “When I’m not in the CFIUS room, it’s really hard to know where the discussions are happening, and quite frankly, what’s being discussed in public doesn’t often align with what’s going on at the table.”

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