Chinese Internet giant ByteDance Ltd (字節跳動) is in talks with Washington about ways to avoid needing to sell its TikTok operations in the US, the Wall Street Journal reported on Wednesday.
TikTok has been at the center of a diplomatic storm between Washington and Beijing, and US President Donald Trump gave Americans a deadline to stop doing business with TikTok’s Chinese parent company, ByteDance, effectively compelling a sale of the app to a US firm.
Walmart Inc has joined forces with Microsoft Corp in negotiations to buy TikTok. Oracle Corp is also reported to be interested.
TikTok — which has been downloaded 175 million times in the US and more than 1 billion times around the world — has filed a lawsuit challenging the crackdown by the US government.
The suit contends that Trump’s order was a misuse of the US International Emergency Economic Powers Act, because the platform is not “an unusual and extraordinary threat.”
Trump claims that TikTok could be used by China to track the locations of US federal employees, build dossiers on people for blackmail and conduct corporate espionage.
The company has repeatedly denied sharing data with Beijing.
Talks between ByteDance and the US have been taking place for months, but have grown more urgent as the deadline set by Trump nears, the Journal reported.
At least one of TikTok’s major investors was part of a group that met with CIA representatives to discuss data security, the Journal reported, citing someone familiar with the matter.
Trump last week repeated his demand for a piece of the action from any sale of TikTok’s US operations for forcing such a deal.
“Well, I told them that they have until Sept. 15 to make a deal. After that, we close it up in this country,” Trump told journalists.
Meanwhile, ByteDance has vowed to “strictly abide” by new export rules in China that could potentially complicate a sale of the business as demanded by Trump.
The Chinese Ministry of Commerce added “civilian use” to a list of technologies that are restricted for export.
The new regulations could make it more difficult for ByteDance to sell the video app, which features clips of everything from dance routines and hair-dye tutorials to jokes about daily life and politics.
In related news, a group of WeChat (微信) users trying to block a US ban of the Chinese app cannot challenge Trump’s authority to make national security decisions, the US said.
“To hold otherwise would allow a group of social media users to substitute their subjective judgment” for that of the president “merely because they are unable to use an app that they prefer,” the government said on Wednesday in a filing in the US District Court in San Francisco.
The US WeChat Users Alliance filed a lawsuit to halt Trump’s Aug. 6 order that would prohibit residents from doing transactions with Tencent Holdings Ltd’s (騰訊) WeChat, as well as with TikTok from this month.
The US government claims that WeChat can be used by the Chinese Communist Party (CCP) to spread disinformation, censor content critical of China and allow the CCP to access Americans’ personal and proprietary information.
The US Department of Commerce is to specify by Sunday next week which transactions with the app would be off limits for Americans, but until then, the WeChat users cannot seek to halt the president’s order, the US government said.
In Wednesday’s filing, the US government said that the president does not need to provide exhaustive evidence to justify his decision that the app is a national security threat.
It referred to a US Supreme Court decision of two years ago that upheld Trump’s travel ban for visitors from a group of Muslim countries, ruling that the president did not need “to conclusively link all of the pieces in the puzzle.”
Publicly available reporting by the US Congress, the US’ executive branch and private security researchers support Trump’s decision, the US government said.
In particular, a detailed report last year by an Australian think tank explained that cooperation between the CCP and private enterprise in China was the “crown jewel” of a foreign policy to build and control a global infrastructure to make the CCP’s ideas the strongest voice in cyberspace, the US government said.
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