US House Panel Approves Bill That Could Force TikTok Sale

A US congressional panel has greenlit a bill mandating TikTok’s China-based parent company, ByteDance, to sell the popular social media app within six months or risk facing a ban. The bill, spearheaded by a bipartisan group of lawmakers from the House of Representatives Select Committee on the Chinese Communist Party and supported by the White House, received unanimous approval from the Energy and Commerce Committee on Thursday.

TikTok, known for its viral videos and extensive user base, swiftly responded to the proposed legislation, expressing apprehension that the bill could impinge upon free speech and adversely affect small businesses reliant on the platform. Encouraging its vast user community to voice opposition, TikTok urged users to contact their Congressional representatives, prompting a flurry of calls flooding the offices of lawmakers.

“Why are members of Congress complaining about hearing from their constituents? Respectfully, isn’t that their job?” the platform said.

While the bill does not target individual users, it specifically targets ByteDance, alleging ties with the Chinese Communist Party, an assertion vehemently denied by both ByteDance and TikTok. The bill, if passed into law, would compel ByteDance to divest TikTok or face removal from US mobile app stores.

Earlier in March 2023, TikTok executives were already reportedly considering splitting off from ByteDance as a way of addressing worries about potential safety threats.

Committee Chairman Mike Gallagher, a Republican from Wisconsin, emphasized the urgency of safeguarding national security interests, stating, “America’s foremost adversary has no business controlling a dominant media platform in the United States.”

Chair of the Communications & Technology Subcommittee Bob Latta seconded the push, asserting that TikTok’s chief executive himself “admitted… that the Chinese Communist Party has access to American user data.”

“If TikTok wants to remain active in the United States, it must divest from the Chinese Communist Party,” the congressman added.

Echoing similar sentiments, Democrat Raja Krishnamoorthi from Illinois underscored the perceived threats posed by TikTok’s Chinese ownership, citing concerns over potential collaboration with China’s political leadership.

The proponents of the bill reject the characterization of their actions as an outright ban on TikTok, asserting that ByteDance has been granted a grace period of approximately six months to comply. However, TikTok countered in a statement released via X, labeling the measure as an outright ban, regardless of attempts to cloak it otherwise.

“This legislation,” TikTok stated, “will infringe upon the First Amendment rights of 170 million Americans and disrupt the operations of 5 million small businesses dependent on the platform for growth and job creation.”

The American Civil Liberties Union (ACLU) concurred, alleging that the bill was a thinly veiled attempt to gain political advantage during an election year. Additionally, the ACLU emphasized the app’s significance as a source of information and communication for many Americans.

This proposed legislation signifies the most recent endeavor by American lawmakers to rein in TikTok’s influence. Many US states have already made strides to ban the app in their respective jurisdictions, particularly Montana.

Information for this briefing was found via BBC and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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