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US House passes bill to force ByteDance to divest TikTok or face ban
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US House passes bill to force ByteDance to divest TikTok or face ban
Mar 13, 2024 8:02 PM

WASHINGTON, March 13 (Reuters) - The U.S. House of

Representatives overwhelmingly passed a bill on Wednesday that

would give TikTok's Chinese owner ByteDance about six months to

divest the U.S. assets of the short-video app, or face a ban, in

the greatest threat to the app since the Trump administration.

The bill passed 352-65 in a bipartisan vote, but it faces a

more uncertain path in the Senate where some favor a different

approach to regulating foreign-owned apps posing security

concerns. Senate Majority Leader Chuck Schumer said the Senate

will review the legislation.

The measure is the latest in a series of moves in Washington

to respond to U.S. national security concerns about China, from

connected vehicles to advanced artificial intelligence chips to

cranes at U.S. ports.

"This is a critical national security issue. The Senate must

take this up and pass it," No. 2 House Republican Steve Scalise

said of TikTok on social media platform X. White House press

secretary Karine Jean-Pierre added later that the Biden

administration also wanted to see "the Senate take swift

action."

The fate of TikTok, used by about 170 million Americans, has

become a major issue in Washington where lawmakers have

complained their offices have been flooded with calls from

TikTok users who oppose the legislation.

TikTok CEO Shou Zi Chew, who a source briefed on the matter

said is visiting Washington this week, said in a video posted

after the vote the legislation if signed into law "will lead to

a ban on TikTok in the United States... and would take billions

of dollars out of the pockets of creators and small businesses."

He added the company will exercise its legal rights to

prevent a ban. The bill gives the company 165 days to file a

legal challenge after it is signed by President Joe Biden, who

said last week he would do so.

The political climate in Washington, at a time when many

politicians do not want to be seen as soft on China during an

election year, increasingly favors the bill. Still, there are

concerns about the impact of any ban on younger voters.

White House national security adviser Jake Sullivan on

Tuesday asked "Do we want TikTok, as a platform, to be owned by

an American company or owned by China? Do we want the data from

TikTok - children's data, adults' data - to be going, to be

staying here in America or going to China?"

The Chinese Foreign Ministry has criticized the legislation,

arguing "though the U.S. has never found any evidence of TikTok

posing a threat to the U.S.'s national security, it has never

stopped going after TikTok."

PROMINENT DEMOCRATS QUESTION BILL

A number of prominent Democrats in the House voted against

the bill including House Democratic Whip Kathleen Clark, Arizona

Senate candidate Ruben Gallego, Alexandria Ocasio-Cortez as well

as the top Democrats on the Judiciary, Ways and Means,

Transportation and Intelligence committees.

"There are serious antitrust and privacy questions here, and

any national security concerns should be laid out to the public

prior to a vote," Ocasio-Cortez said.

Senate Commerce Committee chair Maria Cantwell, who will

play an important role in the Senate's next move, said she wants

legislation "that could hold up in court," and is considering a

separate bill, but is not sure what her next step is.

The vote came just over a week after the bill was proposed

following one public hearing with little debate, and followed

action in Congress stalling for more than a year. Last month,

Biden's re-election campaign joined TikTok, raising hopes among

company officials that legislation was unlikely this year.

Several dozen TikTok users rallied outside the Capitol

before the vote. The company paid for their travel to Washington

and their accommodation, a TikTok spokesperson said.

The group included Mona Swain, 23, who said she had joined

TikTok in 2019, during her freshman year at college pursuing

musical theater. Now a full-time content creator, she said she

was paying her mother's mortgage and for her brother and

sister's college educations with her earnings from the app.

"It's gonna put a lot of people out of work, which is

the scariest part," Swain said of the bill.

UNCERTAINTY OVER SALE

It is unclear whether China would approve any sale or if

TikTok's U.S. assets could be divested in six months.

If ByteDance failed to do so, app stores operated by Apple ( AAPL )

, Alphabet's Google and others could not

legally offer TikTok or provide web hosting services to

ByteDance-controlled applications.

In 2020, then-President Donald Trump sought to ban TikTok

and Chinese-owned WeChat but was blocked by the courts. In

recent days he had raised concerns about a ban but nearly all

House Republicans shrugged those off.

It is unclear if Tencent's ( TCTZF ) WeChat or other

high-profile Chinese-owned apps could face a ban under the

legislation.

Beyond the likely legal challenge from TikTok, the American

Civil Liberties Union and other advocacy groups are arguing the

bill is unconstitutional on free speech and other grounds.

In November, a U.S. judge blocked a Montana state ban on

TikTok use after the company sued.

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