The Wall Street Journal reports that TikTok’s Chineseparent company, ByteDance, has come under pressure from the U.S. government to sell its shares in the popular video-sharing app or face a ban in the country. This development is a significant policy shift by the Biden administration and has sparked a new round of debate. Many have accused the Biden administration of not taking the alleged security threat posed by the China-based company seriously enough, especially after the Chinese company hired a Biden-connected consulting firm.
The sale demand was made by the Committee on Foreign Investment in the United States (CFIUS), a multi-agency federal task force that monitors national security risks associated with international investments. According to TikTok, which was founded in Beijing in 2012, 60 percent of ByteDance’s shares are owned by foreign investors, 20 percent by its staff, and 20 percent by the company’s founders. The founders’ shares do, however, have excessive voting rights, which is standard in the tech industry.
TikTok has stated in response to the CFIUS demand that a forced sale would not eliminate the alleged security risk. Instead, the company has promised to invest $1.5 billion in a program aimed at protecting American user data and content from being accessed or influenced by the Chinese government. In a statement, TikTok spokeswoman Brooke Oberwetter said: “If protecting national security is the objective, divestment doesn’t solve the problem: a change in ownership would not impose any new restrictions on data flows or access.”
