US Government Announces Ban on New Downloads of TikTok as Takeover Discussions continue

With the White House now assessing a proposed TikTok takeover offer, which would make Oracle the primary owner of a new, separate version of the app, the US Commerce Department has announced that, in line with US President Donald Trump’s August 6th Executive Order, new downloads of TikTok will be banned in the US from this Sunday, September 21st.

That doesn’t mean that TikTok has been banned outright in the US, nor that the Oracle deal has fallen through.

To clarify, in early August, US President Donald Trump said that TikTok would be banned in the US, due to concerns over its connection to the Chinese Government, if it was not sold to a US company, and separated from its Chinese roots.

Under China’s cybersecurity laws, any Chinese company can be compelled to provide user data to the CCP in the national interest, which means that, technically, if asked, TikTok’s parent company ByteDance would have to provide the Chinese regime with data on the app’s US users, if requested.

Whether any such request has been made is unclear, but another concern is that TikTok could be used as a propaganda tool with China having previously exerted some influence on the app’s moderation policies and processes.

President Trump officially signed an Executive Order which would implement restrictions on TikTok on August 6th, with a deadline for an alternative business arrangement to be put in place in 45 days from the order. That puts TikTok’s time limit at September 20th – this Saturday – and while Oracle is confident that it’s submitted a consortium deal which will meet the US and Chinese Government’s requirements on buying the app, which would then enable it to continue operating in the US, the US Government has not made a ruling on such as yet. And either way, it would not see the app change ownership by Sunday, even if approved.

That means that new downloads of TikTok, and Chinese-owned messaging app WeChat, will be banned, as will all transactions within the apps.

The US Commerce Department Order outlines these specific restrictions.

  • TikTok and WeChat cannot be made available through any online app store in the US
  • WeChat cannot facilitate funds transfers in the US (note: many Asian businesses, in particular, enable WeChat purchases in-store)

The terms don’t specifically state that US advertisers cannot spend money with TikTok at this stage, though US ad sales may also be restricted (we’re seeking to clarify)

What that means, in practical terms, is that people will no longer be able to download these two apps, but for those that have already downloaded them, TikTok and WeChat will continue to operate as normal as negotiations continue over their future.

That is, at least, till November 12th – in a secondary EO on the divestment of TikTok, the US Government gave parent company ByteDance 90 days to arrange a US takeover deal, or it’ll face a full ban. The extension takes into account the complexities of separating the app – so TikTok may still be saved, and may still come under US ownership over the next two months. But the app’s growth, at least in the US, will be stalled as of Sunday, barring a last-minute injunction of some kind.

In response to the announcement, TikTok has vowed to fight the ‘unjust’ order in court, while it’s also alluded to the pending deal with the Oracle-lead group:

In our proposal to the U.S. Administration, we’ve already committed to unprecedented levels of additional transparency and accountability well beyond what other apps are willing to do, including third-party audits, verification of code security, and U.S. government oversight of U.S. data security. Further, an American technology provider would be responsible for maintaining and operating the TikTok network in the U.S., which would include all services and data serving US consumers.”

Indeed, in documentation submitted to the US Government on the proposed takeover deal, TikTok has said that the arrangement would mean that TikTok in the US would have its own board, which would be approved by the US Government, and that that board would likely include “a former NSA or CIA official with a high-level security clearance”. That would give the Government unprecedented influence over the app, in order to ensure there was no foreign interference. 

Yesterday, The White House said that US President Trump would respond to the proposed Oracle deal within the next two days

In summary, TikTok will no longer be available for new downloads in the US from Sunday, but current users will be able to continue using the app, as normal, for the time being. If the Oracle deal is approved, the ban could be short-lived, and TikTok may continue as normal in the US. 

Now we wait for the next stage in the ongoing TikTok takeover saga.

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