House passes bill that could lead to a TikTok ban; fight shifts to the Senate

The
House
approved
a
bill
Wednesday
that
calls
for
China
tech
giant
ByteDance
to
divest
TikTok
or
the
popular
social
video
app
will
effectively
be
banned
in
the
U.S.

The
measure
passed
with
a
resounding
352-65
vote
and
with
one
member
voting
present.

The
legislation,
dubbed
the
Protecting
Americans
from
Foreign
Adversary
Controlled
Applications
Act,
was

introduced
March
5
by
Reps.
Mike
Gallagher,
R-Wis.,
and
Raja
Krishnamoorthi,
D-Ill.,
of
the
House
Select
Committee
on
the
Chinese
Communist
Party.
Two
days
later,
House
members
on
the
Energy
and
Commerce
Committee

voted
unanimously
to
approve
the
bill,
which
refers
to
TikTok
as
a
threat
to
national
security
because
it
is
controlled
by
a
foreign
adversary.

The
bill
now
heads
to
the
Senate
where
it
faces
an

uncertain
future
as
senators
appear
divided
about
the
legislation,
and
other
federal
and
state-led
efforts
to

ban
TikTok
have
stalled.

“This
process
was
secret
and
the
bill
was
jammed
through
for
one
reason:
it’s
a
ban,”
a
TikTok
spokesperson
said
after
the
vote
was
passed.
“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.”

In
a
short-video

clip
that
was
posted
on
TikTok
later
in
the
afternoon,
TikTok
CEO
Shou
Zi
Chew
expressed
dismay
to
TikTok
users
over
what
he
described
as
a
“disappointing
vote
in
the
House
of
Representatives,”
and
said
that
the
bill
“gives
more
power
to
a
handful
of
other
social
media
companies”
and
that
“it
also
take
billions
of
dollars
out
of
the
pockets
of
creators
and
small
businesses.”

“Over
the
last
few
years,
we
have
invested
to
keep
your
data
safe
in
our
platform,
free
from
outside
manipulation;
we
have
committed
that
we
will
continue
to
do
so,”
Chew
said.
“This
legislation,
if
signed
into
law,
will
lead
to
a
ban
of
TikTok
in
the
United
States,
even
the
bill
sponsors
admit
that
that’s
their
goal.”

Chew
added
that
TikTok
“will
continue
to
do
all
we
can,
including
exercising
our
legal
rights
to
protect
this
amazing
platform
that
we
have
built
with
you.”

President
Joe
Biden,
who
created
an
official
TikTok

account
in
February
as
part
of
his

election
campaign,
has
previously
said
that
he
would
sign
the
bill
if
it
is
passed,
and
White
House
press
secretary
Karine
Jean-Pierre
acknowledged
that
the
White
House
is
providing
“technical
support”
in
the
crafting
of
the
legislation.
Jean-Pierre

said
in
a
media
briefing
March
6
that
once
“it’s
on
legal
standing
and
it’s
in
a
place
where
it
can
get
out
of
Congress,
then
the
President
would
sign
it.”

Although
House
members
who
drafted
the
bill
have
previously

said
that
it
“does
not
ban
TikTok,”
the
legislation
in
its
current
form
requires
ByteDance
to
divest
TikTok
within
roughly
six
months
in
order
for
the
app
“to
remain
available
in
the
United
States.”
If
the
bill
is
enacted,
app
store
owners
such
as


Apple
and


Google
along
with
internet-hosting
companies
would
be
prohibited
from
supporting
TikTok
and
other
apps
that
are
linked
to
ByteDance.

Lawmakers
from
both
parties
have
claimed
that
TikTok
poses
a
national
security
risk
because
of
the
app’s
alleged
ties
to
the
Chinese
Communist
Party,
which
Chew
has
denied
during
Senate

hearings.
On
the
other
hand,
tech
policy
and
civil
liberties
organizations
such
as
the
American
Civil
Liberties
Union
and
the
Knight
Institute
have

opposed
the
bill
over
concerns
that
it
would
violate
First
Amendment
rights.

Meanwhile,
Republican
presidential
nominee
Donald
Trump
said
in

an
interview
with
CNBC
earlier
this
week
that
he’s
concerned
that
banning
TikTok
would
also
make
Facebook
parent
Meta
a
stronger
company.

“Without
TikTok,
you
can
make
Facebook
bigger,
and
I
consider
Facebook
to
be
an
enemy
of
the
people,”
Trump
said.

The
former
president’s
comments
were
noteworthy
considering
that
the
Trump
administration,
citing
national
security
concerns,
previously
tried
to
remove
TikTok
from
app
stores
in
2020
and
also
called
on
ByteDance
to
divest
the
app.
That
same
year,
Microsoft
was

mulling
an
acquisition
of
TikTok
in
a
deal
ranging
between
$10
billion
and
$30
billion,
but
ultimately
talks
between
the
two
companies
fell
through
and
the
Biden
administration
eventually

revoked
the
Trump
administration’s
order.

In
the
chance
that
the
latest
TikTok
bill
passes,
Angelo
Zino,
a
vice
president
and
senior
equity
analyst
at
CFRA
Research,
told
CNBC,
it’s
possible
that
TikTok’s
U.S.-only
business
“could
fetch
a
valuation
north
of
$60
billion”
when
“looking
at
peer
valuations
in
the
market.”

“That
said,
we
don’t
even
know
if
it
would
get
to
that
point
as
ByteDance
could
decide
to
just
have
TikTok
stop
doing
business
in
the
U.S.
if
forced
to
do
so,”
Zino
said
in
an
email.

Earlier
this
week,
prominent
venture
capitalist
and
Republican
megadonor
Keith
Rabois

said
in
a
post
on
X
that
he
would
“never
fund
any
Republican
candidates
or
leadership
PACs
(or
the
NRSC)
run
by
Republicans
who
vote
against
the
TikTok
legislation.”

“Support
for
the
TikTok
bill
is
an
IQ
test”
for
members
of
Congress,
Rabois
said
in
an
email
to
CNBC.

A
potential
ban
of
TikTok
in
the
U.S.
has
resulted
in
several
prominent
TikTok
creators
looking
for
other
ways
to
diversify
their
businesses
and
brands
outside
of
creating
viral
videos
on
the
platform,
CNBC
previously

reported.

Watch:

TikTok
ban
isn’t
censorship,
it’s
national
security,
says
Beacon
CEO