June 6, 2023

WASHINGTON — The Biden administration recently told TikTok that it wants the app’s Chinese owners to sell the app or risk facing a ban in the United States. But the plan hit a snag on Thursday, when Beijing said it would oppose a sale.

The announcement roiled debate over the app’s future, leaving the White House with few clear options.

President Biden’s narrow menu now includes trying to ban the app — the flip side of the government threat. But it will be very difficult without the help of Congress. Or, experts say, he could try to push a sale through a government agency that vets foreign companies, essentially challenging Beijing to honor its objections.

“He has to make a choice: Does he want to confront China over TikTok?” said James A. Lewis, senior vice president at the Center for Strategic and International Studies.

A spokesman for China’s Ministry of Commerce said at a news conference on Thursday that China would “resolutely oppose” the sale of the app. Forcing such a deal would “seriously undermine the confidence of investors from all over the world, including China, to invest in the United States,” she added.

Her rebuke of the Biden administration came just hours before the TikTok CEO testified before Congress for the first time. Executive Shou Chew faced about five hours of tough questioning from lawmakers on both sides about China’s relationship with the company, data privacy and the app’s impact on children. Many lawmakers cited China’s statement as evidence that the app may have been influenced by Beijing.

The government has long worried that Beijing could force TikTok to hand over sensitive data on U.S. users or use its powerful content recommendation algorithms for propaganda. It has been negotiating a deal that would allow the app to continue operating in the United States if it stores its U.S. user data on domestic servers.

But senior government officials have balked at the proposal, and recently made clear they would rather see the app’s Chinese owner, ByteDance, sell it.

Now the government will need to weigh whether to push to ban the app, cutting it off from its 150 million US users. But it’s a legal concern: A federal court has ruled that President Donald J. Trump doesn’t have the power to ban TikTok from Apple and Google’s app stores.

This month, the White House approved a bipartisan Senate bill that would give the Commerce Department explicit authority to ban any app that endangers the safety of Americans. If it passes, the government could have a stronger legal case for banning TikTok.

The government could also revisit the deal it negotiated for TikTok to store its U.S. user data on U.S. Oracle servers. Oracle will also monitor how TikTok’s algorithms recommend content as a possible hedge against the app being used to spread Chinese government disinformation and propaganda.

But the proposal was met with skepticism from some at the top of the administration, including the Justice Department and the White House, leading the administration to push for a sale.

A White House spokesman did not immediately respond to a request for comment.

Dealing with TikTok has become more complicated since Mr. Trump urged ByteDance to sell TikTok in 2020.Later, China modified the List of protected technologies, analysts said ByteDance needs a government license to sell the app to U.S. buyers. TikTok’s most valuable technology is its recommendation algorithm, which is the source of its success in attracting and retaining users around the world.

Moreover, the court ruling banning TikTok from app stores deprived the White House of the critical leverage it used to get ByteDance to consider a sale.

Any decision to remove the app, whether to somehow ban it in the US or prevent further downloads, could be more politically fraught for Mr Biden than Mr Trump. TikTok has millions more users in the US than it did in 2020.

But the roughly five hours of hearings with Mr. Zhou on Thursday suggested a political demand for action was taking shape in Washington. About four dozen lawmakers have targeted Mr. Zhou, with many accusing his company of having close ties to the Chinese government.

He tried to distance himself and TikTok from China, but lawmakers were outspoken.

“When we spoke a few weeks ago, you expressed an interest in taking steps to earn our trust,” said Rep. Lori Trahan, a Democrat from Massachusetts. “And, for me, that hasn’t happened so far today.”

Mr. Chew has repeatedly told lawmakers that the company’s plan to keep user information in the US on servers run by Oracle, which it calls Project Texas, would address their concerns. But they don’t seem to be buying it.

“With all due respect, the phrase ‘no company is perfect’ is used too much today,” said Rep. Angie Craig, D-Minnesota. “It’s clear that in the three-plus hours you’ve been in front of us today, what you’ve said about the Texas plan hasn’t passed the sniff test.”

David McCabe reported from Washington, and Chang Che from Seoul.

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