The Biden administration has threatened to ban TikTok in the US unless the social media company’s Chinese owners divest their stakes in it, according to news reports on Wednesday.
The move, first reported by the Wall Street Journal, is the most dramatic in a series of escalations by US officials and legislators, driven by fears that US user data held by the company could be passed on to China’s government. It also comes amid a global backlash to the popular video-based app over concerns about the potential for Chinese spying, with countries including the UK, Canada and Australia recently moving to ban the app from government phones.
The US has already banned TikTok on federal government devices but this marks the first time under Biden’s administration that a potential nationwide ban on TikTok has been threatened. Any US ban would face significant legal hurdles. Biden’s predecessor, Donald Trump, had tried to ban TikTok in 2020 but was blocked by the courts.
A TikTok spokesperson, Brooke Oberwetter, told Reuters that the company had recently heard from the US Treasury-led committee on foreign investment in the United States (CFIUS), which demanded that the Chinese owners of the app sell their shares, and said otherwise they would face a possible US ban of the video app.
TikTok is one of the world’s most popular social networks with more than 100 million US users.
The Journal said 60% of shares in ByteDance, which owns TikTok, are owned by global investors, 20% by employees and 20% by its founders. CFIUS, a powerful national security body, in 2020 had unanimously recommended that ByteDance divest TikTok.
“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,” TikTok’s Oberwetter said in a statement.
The move comes as TikTok’s CEO, Shou Zi Chew, is due to appear before the US Congress next week.
TikTok and CFIUS have been negotiating for more than two years on data security requirements. TikTok said it has spent more than $1.5bn on rigorous data security efforts and rejects spying allegations.
TikTok said on Wednesday that “the best way to address concerns about national security is with the transparent, US-based protection of US user data and systems, with robust third-party monitoring, vetting, and verification”.
China accused the U S of spreading disinformation and suppressing TikTok.
The US has yet to present evidence that TikTok threatens its national security and was using the excuse of data security to abuse its power to suppress foreign companies, the foreign ministry spokesperson, Wang Wenbin, told reporters at a daily briefing.
“The US should stop spreading disinformation about data security, stop suppressing the relevant company, and provide an open, fair and non-discriminatory environment for foreign businesses to invest and operate in the US,” Wang said.
The news of a potential US ban followed reports this week that Britain is moving forward with its own plan to ban TikTok on government cellphones. The European Commission announced a similar ban last month, and on Monday, Rishi Sunak, the UK prime minister, hinted that he may follow suit, saying he would take “whatever steps are necessary” to protect Britain’s security.
The cabinet office’s announcement of a potential ban could come as early as Thursday, sources told the Guardian, which reported that some critics and experts were calling for Britain to extend the ban to also cover personal phones of officials and ministers.
Talk of restrictions across the globe have escalated in recent weeks after news of the Chinese spy balloon that was found hovering over the US. The scandal prompted a US congressional committee to move forward with legislation that would empower the US president to ban the app. Michael McCaul, a GOP congressman and chair of that committee, said he feared TikTok was akin to “spy balloon in your phone”.
Amid the increasing scrutiny, TikTok earlier this month announced a data security plan that said would protect user information across Europe. That plan, called Project Clover, involves data storage on servers in Ireland and Norway, with a third-party IT company vetting any transfers of data outside of Europe.
Reuters contributed reporting