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US House adopts resolution to require ByteDance to sell TikTok or face ban

Congressman Maxwell Frost (D-FL) speaks as he is joined by fellow House members Rep. Robert Garcia (D-CA), Rep. Sara Jacobs (D-CA), Rep. Delia Ramirez (D-IL) and TikTok creators during a press conference to voice their opposition to the “Protecting Americans from Foreign Adversary Controlled Applications Act," pending crackdown legislation on TikTok in the House of Representatives, on Capitol Hill in Washington, U.S., March 12, 2024

WASHINGTON, March 13 (mod1s) - The U.S. House of Representatives easily approved a measure on Wednesday that would give TikTok's Chinese owner ByteDance about six months to sell the U.S. assets of the short-video app, or risk a ban, in the largest threat to the app since the Trump administration.
 
The law passed 352-65 in a bipartisan vote, but it faces a more unclear road in the Senate where some support a different strategy to regulate foreign-owned applications presenting security issues. Senate Majority Leader Chuck Schumer said the Senate would evaluate the plan.

The proposal is the latest in a string of efforts in Washington to react to U.S. national security worries about China, from linked autos to powerful artificial intelligence processors to cranes at U.S. ports.
 
"This is a significant national security problem. The Senate must take this up and approve it," No. 2 House Republican Steve Scalise said of TikTok on social media site X. White House press secretary Karine Jean-Pierre noted later that the Biden administration also hoped to see "the Senate take swift action."

The destiny of TikTok, used by over 170 million Americans, has become a big issue in Washington as senators have claimed their offices have been swamped with calls from TikTok users who oppose the legislation.
 
TikTok CEO Shou Zi Chew, who a source briefed on the matter said is visiting Washington this week, said in a video posted after the vote the legislation if signed into law "will lead to a ban on TikTok in the United States... and would take billions of dollars out of the pockets of creators and small businesses."

He stated the corporation would pursue its legal rights to oppose a ban. The measure provides the firm 165 days to submit a legal challenge when it is signed by President Joe Biden, who signaled last week he would do so.
 
The political atmosphere in Washington, at a time when many legislators do not want to be regarded as soft on China during an election year, increasingly supports the measure. Still, there are worries about the effect of any prohibition on younger voters.
 
White House national security advisor Jake Sullivan on Tuesday questioned "Do we want TikTok, as a platform, to be controlled by an American firm or owned by China? Do we want the data from TikTok - children's data, adults’ data - to be moving, to be remaining here in America or going to China?"
 
The Chinese Foreign Ministry has denounced the law, claiming "though the U.S. has never found any evidence of TikTok posing a threat to the U.S.'s national security, it has never stopped going after TikTok."
 
PROMINENT DEMOCRATS QUESTION BILL
 
A number of notable Democrats in the House voted against the measure including House Democratic Whip Kathleen Clark, Arizona Senate candidate Ruben Gallego, Alexandria Ocasio-Cortez as well as the top Democrats on the Judiciary, Ways and Means, Transportation and Intelligence committees.
 
"There are serious antitrust and privacy questions here, and any national security concerns should be laid out to the public prior to a vote," Ocasio-Cortez added.

Senate Commerce Committee chair Maria Cantwell, who will play a major role in the Senate's next move, said she wants legislation "that could hold up in court," and is exploring a separate measure, but is not sure what her next step is.

 
The decision occurred barely over a week after the law was submitted after one public hearing with no discussion, and followed activity in Congress languishing for more than a year. Last month, Biden's re-election campaign joined TikTok, sparking expectations among business insiders that legislation was unlikely this year.
 
Several hundred TikTok users gathered outside the Capitol before the vote. The firm paid for their airfare to Washington and their hotel, a TikTok spokeswoman claimed.
 
The trio includes Mona Swain, 23, who claimed she had joined TikTok in 2019, during her freshman year at college studying musical theater. Now a full-time content producer, she claimed she was paying her mother’s mortgage and for her brother and sister’s college educations with her profits from the app.
 
"It's gonna put a lot of people out of work, which is the scariest part," Swain said of the law.

Chart using data from Pew Research Center shows the proportion of U.S. people who have used different social networking applications in 2021 and 2023.

UNCERTAINTY OVER SALE
 
It is uncertain if China would sanction any transaction or whether TikTok's U.S. assets could be unloaded in six months.
 
If ByteDance fails to do so, app shops run by Apple (AAPL.O), opens new tab, Alphabet's (GOOGL.O), opens new tab Google and others could not lawfully provide TikTok or give web hosting services to ByteDance-controlled apps.
 
In 2020, then-President Donald Trump wanted to ban TikTok and Chinese-owned WeChat but was prevented by the courts. In recent days he has voiced worries about a ban but virtually all House Republicans waved them aside.
 
It is unknown whether Tencent's (0700.HK), opens new tab WeChat or other high-profile Chinese-owned applications might risk a ban under the law.
 
Beyond the probable court challenge from TikTok, the American Civil Liberties Union and other advocacy organizations are contending the measure is illegal on free speech and other grounds.
In November, a U.S. court rejected a Montana state ban on TikTok usage after the business sued.


Source: https://www.reuters.com/

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