Bipartisan Lawmakers Introduce Bill to Force TikTok Divestment in US
A group of US lawmakers from both sides of the aisle have proposed new legislation that would require ByteDance, the parent company of TikTok, to sell off the popular app within six months or face a ban in the United States. National security concerns have prompted the introduction of this bill, which would give ByteDance a 165-day deadline to divest TikTok. Failure to comply would make it illegal for app stores to offer TikTok or for ByteDance-controlled applications to receive web hosting services.
It is important to note that individual users of the app will not be affected by this legislation.
The bill is a direct response to worries over the security risks posed by the Chinese ownership of TikTok. This marks the first major attempt by lawmakers to address these concerns in almost a year. If passed, the legislation would grant the president new powers to identify apps that pose national security risks and impose bans or restrictions unless they are divested. The focus of the bill is on apps with more than one million active users per year that are under the control of a foreign adversary entity.
This move comes after a period of inaction following the Committee on Foreign Investment in the United States‘ demand for TikTok’s Chinese owners to sell their shares in order to avoid a ban. While the bill specifically targets TikTok, it does not cover other Chinese non-social media apps, such as retailers Shein and Temu.
Analyst comment
Positive news: The bipartisan bill to force TikTok divestment in the US demonstrates a proactive response from lawmakers to address national security concerns. If passed, it would grant the president new powers to identify and address similar risks, protecting the interests of the US. However, it may negatively impact the market for ByteDance and TikTok, as failure to comply could lead to a ban and restriction of services.
Short analysis: The proposed bill indicates a strong bipartisan effort to address national security concerns related to TikTok’s Chinese ownership. If passed, it could lead to ByteDance divesting TikTok within six months or facing a ban in the US. This could have a negative impact on ByteDance’s market position, while safeguarding national security interests.
