President Trump is reportedly pulling together a TikTok rescue that may not fully cut ties between the social media app and its Chinese parent company.
But such a deal may survive any legal challenges due to how the US law mandating such a separation was written — and the hold that Trump has over the GOP-controlled Congress.
“If you asked me to sort of predict or bet on the success of a legal challenge, my money would be on all of those challenges failing for lack of standing,” said University of Houston Law Center’s law professor Nikolas Guggenberger.
Congress last year passed a law requiring a “qualified divestiture” of TikTok, a reference to control of the company and the algorithm that powers the app. Its Chinese parent can retain no more than a 20% stake in the company.
What’s important to remember is that the law allows the president to determine whether that “qualified divestiture” threshold has been met — giving Trump some leeway as he tries to pull a deal together before a renewed ban of the app takes effect on April 5.
In the deal currently being negotiated — according to reporting by Reuters and Politico and other media outlets — the biggest non-Chinese investors in ByteDance may increase their existing stakes and acquire the US operations of TikTok as part of a new entity. That would push Chinese ownership below a critical 20% threshold.
TikTok and its CEO, Shou Zi Chew, have repeatedly objected to letting go of the app’s proprietary algorithm. The deal being contemplated, according to media reports, would task tech giant Oracle with safeguarding Americans’ data on TikTok to ensure it is not available to China.
That may not go far enough to satisfy some who wanted to eliminate all Chinese involvement.
“The law is clear,” Rep. John Moolenaar (R-Mich.), chair of the House Select Committee on the CCP, wrote in the National Review. “Any deal must eliminate Chinese influence and control over the app to safeguard our interests.”
TikTok’s parent company, ByteDance, operates under Chinese Communist Party law, which requires it to share user data upon request.
US intelligence officials have expressed concern that the CCP could use Americans’ data against them and use TikTok’s algorithm to gain backdoor access to swaths of information on US citizens.
That is largely the reason former President Joe Biden signed legislation last April requiring TikTok to divest or face a nationwide ban. The US Supreme Court upheld the law against a constitutional challenge from TikTok and TikTok users.
