TikTok’s Dilemma: Chinese stake vs. potential ban in the US

The popular video app TikTok, which has over 100 million users in the US, could be facing a possible ban by the Biden administration if its Chinese owners do not divest their stake in the company.

This move comes amid growing concerns from US officials and legislators that TikTok's user data could be passed on to the Chinese government. The Trump administration attempted to ban TikTok in 2020 but was prevented from doing so by court rulings.

TikTok's Chief Executive, Shou Zi Chew, is due to appear before Congress next week to address these concerns.

The company has been negotiating with the Committee on Foreign Investment in the United States (CFIUS) for over two years on data security requirements and claims to have spent more than $1.5 billion on rigorous data security efforts.

TikTok has also rejected allegations of spying.

However, if protecting national security is the objective, divestment may not solve the problem, according to a statement by TikTok spokesperson Brooke Oberwetter.

She said that a change in ownership would not impose any new restrictions on data flows or access.

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TikTok thinks that the best way to deal with worries about national security is to protect US user data and systems in a clear, US-based way, with strong third-party monitoring, vetting, and verification.

There would be several legal obstacles in the way of a hypothetical TikTok ban in the US.

The Treasury-led Committee on Foreign Investment in the United States made the most recent sale request to TikTok, according to the Wall Street Journal.A Treasury representative, however, declined to offer any additional insight.

TikTok's future in the US is still in doubt because of the scrutiny the company continues to endure regarding its data security procedures.

It's not clear how TikTok will handle these problems or if a ban will be put in place, since its CEO is going to testify before Congress the week after that.

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