On a Wednesday morning, President Joe Biden authorized a new law that required TikTok to separate from its parent company or risk being prohibited. This decision came right after the bill was passed by the U.S. Senate the day before.
President Biden expressed his support for the legislation, emphasizing its role in boosting national security and showcasing American leadership values of democracy and freedom, while opposing tyranny and oppression.
The owner of TikTok, ByteDance, now faces a familiar choice that emerged when former President Donald Trump also threatened to ban the app: either sell it or depart from the American market. The updated terms of the agreement grant ByteDance up to 12 months to divest from TikTok before the app potentially gets removed from U.S. app stores and web hosting services. This time frame represents a significant extension from the initial six-month deadline.
In response to the potential ban, TikTok issued a statement challenging the constitutionality of the law and vowing to contest it in court. The company highlighted its substantial investments in ensuring the security of U.S. user data and protecting the platform from external influence. TikTok argued that a ban would negatively impact millions of businesses and silence a vast number of American users. Despite the legal battle ahead, TikTok remains committed to maintaining a safe space for diverse American voices and experiences.
The ultimatum presented to TikTok was part of a larger foreign aid package that also allocated resources to countries like Israel, Taiwan, and Ukraine. This broader context likely contributed to the bill’s approval, as lawmakers considered the interconnected implications of both the app-related decision and international aid commitments.
During a previous episode of threats against TikTok, discussions with Oracle were underway for a potential deal. However, these negotiations fizzled out when the Biden administration assumed office, easing the immediate pressure on ByteDance to sell the app.
If ByteDance’s legal defense proves unsuccessful, it remains uncertain whether the company would revisit the option of a sale. Nevertheless, given the significance of the U.S. market to its operations, it appears unlikely that ByteDance would exit without exploring all available avenues.
