A bill that would force China-based ByteDance to sell TikTok or face a ban in the US is one large step closer to becoming law, after passing through the House of Representatives.
The Protecting Americans From Foreign Adversary Controlled Applications Act passed 253 to 65 on the House floor on Wednesday (March 13), with one lawmaker voting “present.”
The vote came little more than a week after it was introduced by Republican Rep. Mike Gallagher of Wisconsin and Democratic Rep. Raja Krishnamoorthi of Illinois, and six days after it sailed through the House Energy and Commerce Committee in a unanimous (50-0) vote.
By the standards of the US Congress, that’s breakneck speed.
However, the bill’s momentum is now likely to slow, as no companion bill has yet been introduced in the Senate.
“This process was secret and the bill was jammed through for one reason: it’s a ban,” TikTok said in a statement on X shortly after the vote on Wednesday morning.
“We are hopeful that the Senate will consider the facts, listen to their constituents, and realize the impact on the economy, 7 million small businesses, and the 170 million Americans who use our service.”
The bill’s sponsors have repeatedly insisted that it’s not a ban, as ByteDance has the option of selling the platform’s US operations, and the bill is meant to address national security concerns surrounding TikTok, as ByteDance is legally required to share data with the Chinese government upon request.
“This process was secret and the bill was jammed through for one reason: it’s a ban.”
TikTok
In an appearance before Congress last year, TikTok CEO Shou Zi Chew denied that TikTok shares US users’ data with the Chinese government and stressed the company’s plans to move its US data to servers operated by Oracle in Texas.
If passed, the law would give ByteDance 165 days, or slightly more than five months, to divest its holdings in TikTok, or it would become illegal for the app to be offered in app stores in the US, and illegal for web hosting services in the US to provide services to TikTok.
The bill has received the support of President Joe Biden, who told reporters last week that, if Congress passes it, “I’ll sign it.”
Surprisingly, the bill has been opposed by former president and current Republican frontrunner Donald Trump, who himself attempted to ban TikTok by executive order while in office in 2020, on national security grounds.
However, Trump’s reason for opposing the new bill was not about national security.
“Without TikTok, you can make Facebook bigger, and I consider Facebook to be an enemy of the people,” Trump said in an interview with CNBC.
The bill’s fate in the Senate is unclear, but news reports suggest it would face more opposition in the upper chamber, including from Republican Sen. Rand Paul of Kentucky, one of the US’s most prominent libertarians, who has said the bill violates US citizens’ First Amendment right to freedom of speech.
However, the bill does seem to have support from two key members of the Senate: Democratic Sen. Mark Warner of Virginia and Republican Sen. Marco Rubio of Florida, respectively the chair and ranking member of the Senate Intelligence Committee.
“We are united in our concern about the national security threat posed by TikTok – a platform with enormous power to influence and divide Americans whose parent company ByteDance remains legally required to do the bidding of the Chinese Communist Party,” they said in a joint statement, as quoted by The Hill.
“We were encouraged by today’s strong bipartisan vote in the House of Representatives, and look forward to working together to get this bill passed through the Senate and signed into law.”
Who could buy TikTok?
With the bill moving further than any previous attempt at banning TikTok or severing it from its parent company, the business community is speculating on who might buy TikTok’s US operations, if ByteDance were to decide to sell.
Chris Pavlovski, CEO of YouTube competitor Rumble, posted a letter on X to TikTok’s Shou Zi Chew, saying the platform would be willing to join a consortium to buy TikTok’s US operations.
Such a move would likely alarm many of the supporters of the TikTok ban, given that Rumble’s uncompromising “free speech” stance has made it a target for criticism that it doesn’t do enough to remove hate speech and other harmful content from its platform.
Acquiring TikTok could be a pricey proposition for whoever decides to attempt it. Angelo Zino, a vice president and senior equity analyst at CFRA Research, told CNBC that TikTok’s US operations “could fetch a valuation north of USD $60 billion” when “looking at peer valuations in the market.”
“We are united in our concern about the national security threat posed by TikTok – a platform with enormous power to influence and divide Americans whose parent company ByteDance remains legally required to do the bidding of the Chinese Communist Party.”
Sens. Mark Warner (D-VA) and Marco Rubio (R-FL)
However, many legal analysts say ByteDance’s first move wouldn’t be a sale, but rather a constitutional challenge of the law in the courts.
The bill is “contradictory to the rule of law,” said Susan Ariel Aaronson, a research professor of international affairs at George Washington University, as quoted by The Hill.
Meanwhile, Sarah Kreps, director of the Tech Policy Institute at Cornell University, told The Hill that – contrary to what the bill’s sponsors have said – this latest anti-TikTok bill may not “actually sidestep the free speech concerns” raised by previous attempts.
The bill is being opposed by civil liberties groups such as the American Civil Liberties Union (ACLU) and the Electronic Frontier Foundation, as well as the Computer & Communications Industry Association (CCIA), whose membership includes Amazon, Apple, Google and Meta Platforms.
“We’re deeply disappointed that our leaders are once again attempting to trade our First Amendment rights for cheap political points during an election year,” the CCIA said last week.
“Just because the bill sponsors claim that banning TikTok isn’t about suppressing speech, there’s no denying that it would do just that. We strongly urge legislators to vote no on this unconstitutional bill.”Music Business Worldwide