Trump issued an executive order August 14 forcing TikTok’s Chinese owner to divest its US assets, citing national security grounds.(Reuters Photo)
Trump issued an executive order August 14 forcing TikTok’s Chinese owner to divest its US assets, citing national security grounds.(Reuters Photo)

Top Democrat says Donald Trump’s remarks on TikTok deal are inappropriate

Rhode Island Representative David Cicilline, who is leading a probe of the technology industry, told Bloomberg News on Wednesday that it’s the job of federal enforcement agencies to determine whether TikTok, which is owned by China-based ByteDance Ltd., promotes competition or compromises national security and said that the president shouldn’t insert himself into the outcome of those decisions.
By Bloomberg| Posted by: Harshit Sabarwal
UPDATED ON AUG 27, 2020 07:01 AM IST

A top House Democrat rebuked President Donald Trump for commenting on the potential acquisition of the domestic operations of the popular TikTok video app by a US company, but at the same time said such a deal could protect American interests.

Rhode Island Representative David Cicilline, who is leading a probe of the technology industry, told Bloomberg News on Wednesday that it’s the job of federal enforcement agencies to determine whether TikTok, which is owned by China-based ByteDance Ltd., promotes competition or compromises national security and said that the president shouldn’t insert himself into the outcome of those decisions.

Trump issued an executive order August 14 forcing TikTok’s Chinese owner to divest its US assets, citing national security grounds. He subsequently weighed in on possible bids by Microsoft Corp. and Oracle Corp. Cicilline said it’s not the president’s role to decide who that buyer should be.

“What we don’t need is the president of the United States injecting himself into a transaction in the way that he did,” Cicilline said. “I think that’s dangerous -- that kind of politicization of that company and their practices.”

Trump has stepped up his attacks on TikTok as his administration increased pressure on China ahead of the November presidential election. Earlier this month, Trump threatened to shut down TikTok if its owners didn’t sell the business to a US company by Sept. 15. Then, on August 6, he signed a pair of executive orders prohibiting Americans from doing business with TikTok and another app, WeChat, which is also Chinese-owned, effective in 45 days.

“I don’t mind whether it’s Microsoft or someone else, a big company, a secure company, a very American company buys it,” Trump told reporters on August 3. “It’ll close down on September 15 unless Microsoft or somebody else is able to buy it and work out a deal, an appropriate deal, so the Treasury of the United States gets a lot of money.”

In an Aug. 19 speech in Arizona, Trump praised another possible bidder, Oracle.

“Oracle is a great company,” said Trump during the speech. “I think its owner is a tremendous guy. He’s a tremendous person. I think that Oracle would be certainly somebody that could handle it.”

Trump ordered TikTok to sell its US assets after an investigation by the Committee on Foreign Investment in the US, or Cfius, which reviews acquisitions of American businesses by overseas investors for national security risk. Cfius found ByteDance’s 2017 purchase of the app Musical.ly and merger with TikTok did raise concerns and Trump’s order effectively called for a reversal of that transaction.

Cfius will have to certify that a sale to a US buyer resolves all outstanding national security concerns.

“I guess Microsoft wants it and so does Oracle, and probably so do other people,” Trump told reporters earlier this month. “But they have to also make sure the United States is well compensated because we’re the ones making it possible. Very simple: We’re the ones making it possible. So our Treasury has to be very well compensated.”

Cicilline said if a US company buys TikTok, the purchase could give Facebook Inc. much-needed competition in the social media market and keep valuable data on American users out of the hands of Chinese authorities.

“I think we have to obviously be conscious of the implications when that kind of data is collected by a foreign adversary,” Cicilline said, referring to TikTok. “I think it’s perfectly appropriate in reviewing a transaction to take into account the national security interests of the United States.”

Cicilline, who chairs the antitrust panel of the House Judiciary Committee, has been investigating whether companies such as Facebook, Alphabet Inc.’s Google, Amazon.com Inc. and Apple Inc. are too dominant in the marketplace. Last month, the chief executives of the four US technology giants appeared before the subcommittee to answer questions about whether they use their power to crush rivals.

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