ByteDance, the Chinese company that owns TikTok, is facing a looming deadline on September 15 to sell its U.S. operations or have it closed by the Trump administration. On Thursday night, President Trump told reporters that the deadline would not be postponed.
“We will shut down TikTok in this country for security reasons, or it will be sold,” Trump said just before boarding a flight to Michigan. “I’m not extending the deadlines. No. It’s September 15th. There will be no extension of the TikTok deadline.”
Reports indicate that both Microsoft and Oracle have bid on ByteDance’s US operations. The problem is that companies may not be able to meet the conflicting demands of the governments of the United States and China.
In early August, Trump declared TikTok a threat to national security due to the potential for the Chinese government to collect data on American users and conduct disinformation campaigns in the United States. Trump said the International Emergency Economic Powers Act gives the president the authority to shut down an app like TikTok if it threatens national security.
A subsequent order on August 14 retroactively blocked ByteDance’s 2017 acquisition of Musical.ly, the platform that subsequently evolved into TikTok. The president has the power to block international mergers that raise national security concerns, and some experts see this as a stronger legal basis for shutting down the service.
ByteDance has received offers from both Microsoft and Oracle, and was reportedly close to picking one when the Chinese government stepped in. In late August, Beijing announced new export control rules that restricted the exports of artificial intelligence software without government approval.
TikTok has sophisticated video recommendation algorithms that would likely conflict with those rules. So the new rules mean that any sale would have to be approved by the Chinese government, which would prefer the US not to take control of one of China’s most popular global technology platforms.
There is a danger that the conflicting demands of the US and Chinese governments leave no room for TikTok to strike a deal with Microsoft, Oracle or anyone else. If so, ByteDance may be forced to close its operations in the United States.
But it’s unclear when a ban will actually go into effect. Trump told reporters that ByteDance must make a deal by Sept. 15. But Trump’s written executive orders had different deadlines: around September 20 for the first executive order and mid-November for the second. These deadlines could also be postponed by the courts as they consider ByteDance’s arguments that the orders themselves are illegal.