TikTok gets 15-day extension to divest US assets

Source: Global Times Published: 2020/11/14 14:52:57

TikTok. Photo: VCG

Popular video-sharing platform TikTok has been granted a reprieve from the US government, with a 15-day extension to divest its US operation. Although it is still unclear how TikTok might fare under the incoming Joe Biden administration, experts say the extension is a good omen for the company. 

According to US media reports, the deadline for US government approval of a proposed divestment deal has been extended to November 27. 

The outcome of TikTok's US operations will have important implications for U.S.-Chinese relations, and the future shape of the global internet industry, as it is related to how Chinese technology companies will be received and treated around the world, suggested experts.

Tian Yun, director of the Beijing Economic Operation Association said that many Chinese high-tech firms may get a break under the incoming Biden administration whom he describes as pragmatic and more supportive of business cooperation, unlike the Trump administration, which is much more unpredictable, and often disrupted normal market activities with extreme measures. 

The embattlement of TikTok started months ago when Trump threatened to ban the app in the US market, citing national security reasons, despite the fact TikTok has repeatedly said it has not and will not provide data gathered in the US to the Chinese government. 

Oracle and Walmart has been reportedly in talks with TikTok's parent company Bytedance for a potential acquisition of the company's US assets However, the details of the reported agreement, including the number of shares that will be controlled by the US companies, remain unknown.

Although the US crackdown on Chinese social-media apps was launched by the Trump administration, it remains unclear how President-elect Joe Biden will address the situation, but Tian estimated that the ban is likely to be reversed by the Biden government. 

"It is possible that the ban will be left as an empty shell after Trump is gone," Tian said. "Even if it goes into effect, it is likely that Bytedance will end up holding a larger share of TikTok US operations, than it originally expected."

However, as long as the US executive order remains, it will hang like a sword over the head of TikTok, industry analysts told the Global Times.

Shen Yi, a professor at the School of International Relations and Public Affairs of Fudan University, said Chinese companies should not make assumptions about who is in the White House. "Don't hold any illusions. Calmness and alertness are needed at the moment to prepare for any US move against Chinese firms."

Global Times 

Posted in: COMPANIES

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