TikTok leadership is considering the possibility of splitting from parent company ByteDance based in Beijing (China) if a deal with the US related to national security risks fails.
current proposal Bloomberg, citing people familiar with the matter, said on March 14 that the divestment is considered a last resort, only done if TikTok to US national security officials is not approved. The divestment action may result in the sale or initial public offering (IPO).
TikTok has agreed to undergo a national security review by the Commission on Foreign Investment in the US (CFIUS) since last year. Under the plan, called Project Texas, TikTok agreed to bring in software from Oracle Corp, an American multinational computer corporation, to store American user data, and to designate a three-person supervisory board approved by the US government.
However, CFIUS’s process is stalling, which makes TikTok uncertain whether the company’s plans are sufficient to continue operating in the US. According to Bloomberg, members of CFIUS from the Department of Justice were not willing to accept TikTok’s proposal.
The short video-sharing app has recently faced constant scrutiny from lawmakers, who fear ByteDance could be forced to share data with the Chinese government or be used by China. used as a tool of influence. US lawmakers from both Republicans and Democrats have proposed numerous bills calling for a ban on TikTok.
It is known that TikTok CEO Shou Chew was asked to testify before a US House of Representatives committee this month about the app’s data privacy and security practices, as well as clarify the company’s relationship. with the Chinese government.
Recently, Republicans on the House Foreign Affairs Committee passed a bill that gives the administration of US President Joe Biden the power to ban TikTok and other apps deemed to pose a national security risk. However, it is not clear when the bill could be brought to the House of Commons for a vote.
Elsewhere, federal agencies are in the process of removing TikTok from government devices as required by a provision in the $1.7 trillion general spending law enacted in December 2022.