TikTok deadline is possibly here and a sale is unlikely to be finalized
posted Sunday Sep 13, 2020 by Scott Ertz
Since the original executive order was issued, the deadline for TikTok's sale or closure has been a little confusing. The executive order set a September 15, 2020 deadline for a US company to purchase the US operations or face a complete ban within the country. Later, a second order was issued, giving a deadline in November. However, comments from President Trump this week suggest that the original deadline of this Tuesday will stand.
Last month, a deal was said to be close to closing, however, China threw a variety of issues into the process. The first was a match to US law that disallows uS companies form exporting encryption and security technology. China put a similar regulation into effect, preventing the export of some of TikTok's core matchmaking technology. Without this aspect of the platform, there is far less value to the purchase.
This past week, however, China added a new wrinkle, with officials saying that they would prefer that US operations be terminated than let ByteDance sell part of its operations. They also said that they would be intimately involved in any sales negotiations with Western companies. This will take the form of approval or denial of any sale of technology or operations.
Of course, all of these added challenges are going to make it so that Western companies will be less interested in negotiations. That is most likely the purpose of adding the hurdles to the process - the Chinese authorities are challenging the US government to see if a ban will actually be implemented and maintained. Essentially, it seems they are trying to call the President's bluff. They have even begun a ground game, with a spokesperson saying,
TikTok is loved by 100 million Americans because it's a home for entertainment, self-expression, and connection. We're committed to continuing to bring joy to families and meaningful careers to those who create on our platform for many years to come.
The mistake is that Trump is not one to be called out and back down. If the sale is not completed, there is little doubt that the app will be banned. It seems we won't have long to wait to find out.