TikTok now seeks federal court intervention as Trump had passed an executive order to shut down its operations in the US. The executive order was signed during August, and the company has time until Thursday to sell its US operations to an American company.
According to earlier news regarding this shutdown, the Trump administration had said that TikTok should be sold to American companies like Oracle and Walmart, and they would have a financial stake in the company. In this way, US companies will monitor their operations, and they can rely on the company in the long run.
However, as the government was busy with the US elections till now, not much progress has happened in this regard, and ByteDance, which owns TikTok, has now approached the federal court to intervene in this matter. ByteDance said that it had not received any news regarding the acceptance or rejection of TikTok’s proposal from the US companies.
TikTok issued a statement to the media and said that they had not received any reports from CFIUS about further developments. In this regard, the deadline of November 12th issued by CFIUS will be difficult to manage for the company. For this reason, they have approached the court and filed a petition to defend the rights of the company and its employees. TikTok has more than 1500 employees in the US.
The problem started with souring relationships between the US and China. The Trump administration felt that they could not rely on a company that is owned by Chinese nationals, and the Chinese government could use the app to spy on users in the US. However, TikTok has denied the security allegations and said that they are willing to work with the authorities to address their concerns.
The company said that they have now filed a petition so that they get a fair chance to discuss the security concerns with the authorities. The Trump administration wanted to impose a complete ban on the app and block its access to users in the US. However, the federal judges have not allowed it, and the company still continues to operate in the US.
TikTok has faced similar allegations elsewhere, and countries like India have completely banned the app without any sort of discussion with the owners of the company. The Indian government imposed a blanket ban on several Chinese owned companies citing security concerns from those apps. TikTok was banned without any court petition or legal hassles in India. TikTok also did not defend their services in India, and they shut down their operations completely without any issues.
However, in the US, the company did not get banned, and they were just given a warning regarding security concerns. If TikTok can prove that their app is safe and there are no security concerns, they can continue to operate without any hassles. The Trump administration was keen to ban the app completely, and this was not easy as the company was registered in the US and even had more than 1500 employees in several cities.
The government worked out a formula wherein the company would be allowed to operate in the US, provided they offered shares to some reliable US companies. In this way, TikTok will not be a wholly Chinese owned company in the US, and it will have to share ownership with some US companies like Walmart. The proposal was accepted by TikTok, and several tech companies were initially interested in buying a major stake in the company. But later on, nothing happened in this direction as the economic slowdown forced many tech companies to cut down on their spending.
TikTok has a good reach in the US, and it is one of the most popular video-sharing apps in the US. Even though many video sharing apps came into the market after the success of TikTok, nothing came closer to its easy user interface and simple features. In this way, TikTok became one of the most sought after apps for sharing small videos of less than a minute. The app became so popular that it even created a host of new celebrities across the US who could showcase their talent without any organized platform.
Many talented singers, artists, musicians, and actors took the help of such apps to get in touch with their followers. TikTok is used by millions of users in the US, and there are no known security threats of using the app. However, the US security agencies seem to have some hidden motive in making allegations against TikTok as this company owned by ByteDance is based in China.
The US and China have not had good relations for many years as there are many trade wars going on between the countries. Even though both countries have many trade relationships, especially in the technology sector, things are not rosy between them. The Trump administration is not happy with the military might of China in the Asian region, and Donald Trump has openly expressed his support to India to fight against China.
All these things are having an impact on the business relations, and TikTok has become a victim of souring relationships between the US and China. The main allegation against the company is that the Chinese government has substantial control over ByteDance, which owns TikTok, and they could be using their dominant position to monitor the activities of TikTok users in the US. Even though these allegations have not been proven in any court, the Trump administration went ahead and signed an executive order to shut down TikTok or sell it to some US companies before the November deadline.
Later on, the administration got busy with US elections, and the issue was sidelined. As the deadline has approached now, TikTok is seeking the intervention of the federal court to protect the rights of its employees in the US. It would be interesting to see the response of the federal court in this regard and what action the new government in the US might take regarding banning such apps in the country.