Biden Signs Into Law A Bill Requiring ByteDance to Sell TikTok

In a landmark decision with profound implications for the tech industry, the U.S. Senate has passed a bill mandating ByteDance, the parent company of popular social media platform TikTok, to divest its ownership within 270 days or risk losing access to the lucrative U.S. market.

The bill, christened the “Protecting Americans From Foreign Adversary Controlled Applications Act,” sailed through the Senate with a resounding 79-18 vote, reflecting bipartisan concern over potential national security risks posed by Chinese-owned technology companies operating within U.S. borders.

This legislative initiative, embedded within a larger appropriations bill aimed at providing aid to Ukraine, Israel, and Taiwan, has been signed into law by President Joe Biden, solidifying the government’s commitment to safeguarding critical infrastructure and sensitive data from foreign interference.

The bill classifies TikTok as a “foreign adversary controlled application,” effectively compelling ByteDance to initiate the sale of the platform to a non-Chinese entity within the prescribed timeframe. President Biden retains the prerogative to extend the divestiture deadline by up to 90 days if significant progress toward a sale is underway.

However, TikTok could retain its foothold in the U.S. market if the president determines that the divestiture would sufficiently mitigate concerns related to foreign control. The bill also extends its purview to cover other applications designated as being controlled by foreign adversaries, reflecting broader apprehensions regarding national security vulnerabilities inherent in the digital landscape.

In the event of ByteDance’s non-compliance with the divestiture mandate, the bill empowers U.S. authorities to implement punitive measures. This includes the expulsion of TikTok from U.S. app stores and restrictions on internet hosting services facilitating its distribution. Companies found in violation of these provisions would be subject to civil penalties, underscoring the government’s resolve to uphold regulatory integrity in the tech sector.

Senate Commerce Committee Chair Maria Cantwell explained that the legislation is not intended as punitive action against ByteDance or TikTok but rather as a proactive measure to counter potential threats posed by foreign adversaries. 

“Congress is acting to prevent foreign adversaries from conducting espionage, surveillance, malign operations, harming vulnerable Americans, our servicemen and women, and our U.S. government personnel,” she stated.

However, concerns have been raised regarding potential censorship implications, with Senator Ed Markey cautioning that the bill is “really just a TikTok ban,” highlighting the delicate balance between national security imperatives and individual freedoms. 

Similarly, Senator Ron Wyden expressed concern that the bill “provides broad authority that could be abused by a future administration to violate Americans’ First Amendment rights.”

Despite these reservations, both Senators Markey and Wyden ultimately voted in favor of the appropriations bill that includes the TikTok-inspired law.

In response to the legislation, ByteDance has announced its intention to challenge the law in court, asserting that it constitutes a violation of the First Amendment rights of TikTok’s 170 million American users. 

“This legislation is a clear violation of the First Amendment rights of TikTok’s 170 million American users,” remarked Michael Beckerman, TikTok’s public policy head in the U.S. “We’ll continue to fight… This is the beginning, not the end of this long process.”

In 2020, the embattled short-form video app received favorable rulings from courts, halting the implementation of executive orders issued by former President Donald Trump. US District Court Judge Wendy Beetlestone, in November 2020, issued an injunction that prevented the Commerce Department from prohibiting data hosting within the United States for TikTok, as well as content delivery services and other technical transactions. 

Beetlestone said in her ruling that the order would “have the effect of shutting down, within the United States, a platform for expressive activity used by approximately 700 million individuals globally. Over 100 million of these TikTok users are within the United States, and at least 50 million of these US users use the app on a daily basis.”

This marked a second victory for TikTok, following a previous ruling by District Judge Carl Nichols in September 2020, issued in Washington. In that ruling, a preliminary injunction was granted in a suit brought by TikTok’s parent company, ByteDance, preventing the US Commerce Department from compelling Apple and Google to cease the downloading of TikTok’s app from their respective app stores.

These rulings represented significant legal victories for TikTok in its ongoing legal battles against restrictions imposed by the US government. TikTok hopes that it will get a favorable judgment this time as well.

In a statement, the company expressed confidence in its legal stance, affirming that “we will ultimately prevail” in court and asserting that the company “has invested billions of dollars to keep U.S. data safe and our platform free from outside influence and manipulation.”