President Trump signed an executive order Thursday that will prohibit transactions with social media app TikTok's parent company, ByteDance, and is threatening to impose sanctions on violators who fail to comply.
The order would ban "any transaction by any person, or with respect to any property, subject to the jurisdiction of the United States, with ByteDance Ltd. (a.k.a. Zìjié Tiàodòng), Beijing, China, or its subsidiaries, in which any such company has any interest, as identified by the Secretary of Commerce."
The commerce secretary will "identify the transactions subject" to the ban in 45 days, when it goes into effect.
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It is not clear if the ban will affect the millions of U.S. users who are avid fans of the app.
Forty-five days is the period of time that Mr. Trump agreed to give ByteDance to negotiate a deal to sell its U.S. operations, Reuters reported. Microsoft said it is in discussions with Beijing-based ByteDance about a possible acquisition, and has said it hopes to clinch a deal by September 15. Microsoft CEO Satya Nadella spoke last weekend with Mr. Trump.
The order states that the action is being taken to address the threat to the nation's "national security, foreign policy and economy" posed by the spread in the U.S. of "mobile applications developed and owned by companies in the People's Republic of China."
The order claims the app "automatically captures vast swaths of information from its users," like internet activity, location data, and browsing history, and potentially gives China access to Americans' personal information. The order contemplates the possibility that the Chinese could compile "dossiers of personal information for blackmail" and conduct "corporate espionage" against federal employees and contractors.
In a blog post published Friday, TikTok expressed shock at the order, claiming it was "issued without any due process":
"The Administration paid no attention to facts, dictated terms of an agreement without going through standard legal processes, and tried to insert itself into negotiations between private businesses," the company said. "This Executive Order risks undermining global businesses' trust in the United States' commitment to the rule of law, which has served as a magnet for investment and spurred decades of American economic growth. And it sets a dangerous precedent for the concept of free expression and open markets. We will pursue all remedies available to us in order to ensure that the rule of law is not discarded and that our company and our users are treated fairly – if not by the Administration, then by the US courts."
Days ago, President Trump threatened to ban TikTok from the U.S. through executive action. The U.S. Army has banned the use of TikTok on official devices, and India has banned the app entirely. But the company claims it is committed to protecting its users' privacy and said in a prior statement that its user data is "stored in the U.S., with strict controls on employee access."
Mr. Trump also signed a similar order Thursday targeting another social media and messaging app, WeChat, which is owned by Tencent Holdings, another Chinese company. The president said in his order, "Like TikTok, WeChat automatically captures vast swaths of information from its users," and charged that the app also captures personal information belonging to Chinese nationals visiting the U.S., allowing the Chinese government to track them.