In case you were not keeping up with the TikTok social media saga, WaPo has a near-tutorial on it:
President Trump’s promise this week to bar the popular, Chinese-owned TikTok from operating in the United States is the latest move in his increasingly hostile posture toward Beijing that echoes a broader, anti-China stance within the Republican Party ahead of the November elections.
In essentially every reference to the novel coronavirus and the disease it causes, covid-19, Trump has derided it as the “China virus,” faulting the country for being unable to contain it as it spread beyond its borders and led to more than 17.6 million cases worldwide. When he floated a potential TikTok ban in a television interview last month, Trump indicated it was in retaliation for China’s role in the pandemic.
Curious about the two strategies that Trump can pursue? TikTok was acquired by Chinese company ByteDance, both of which had an American presence, and it seems that there’s a law that mergers subject to American jurisdiction that have a national interest component maybe retroactively refused permission, essentially forcing the sale of TikTok to a more acceptable entity.
Or TikTok can simply be banned, as Professor Chesney explains on Lawfare:
4. But there’s also much talk about a simple “ban” on TikTok. Is that just wishful thinking by parents, or is that a thing the President can do?
Yes, it’s a real thing, thanks to the International Emergency Economic Powers Act (IEEPA). But it’s complicated.
IEEPA is another example of Congress delegating to the executive branch an aspect of its constitutional control over foreign commerce. Think of it as a general pre-delegation of authority to impose embargoes as well as more-targeted sanctions against foreign entities—backed by criminal law sanctions—for a broadly-defined array of circumstances in which the president determines that U.S. national interests are at stake. (For a deep-ish dive into IEEPA, check out Episode 133 of the National Security Law Podcast). When the president wants to use this authority, he first must issue a public proclamation of a “national emergency” on a particular situation or subject, under the National Emergencies Act. This opens the door to using IEEPA itself. Under IEEPA, the president (or the executive branch entity acting on the president’s behalf through a further delegation) can investigate, regulate or simply prohibit—that is, ban—an array of activities involving a sanctioned entity (including payments, notably) and can freeze the assets of that entity (thereby prohibiting all dealings with the foreign entity’s interests in those assets). Sometimes this authority is exercised by the president only to the extent of creating a specific sanctions regime, with the actual sanctioning of particular entities to be done at a later date (if it is done at all). At other times, the creation of the sanctions regime is accompanied by at least an initial set of designations of specific entities.
I don’t blame you if you’re not a lawyer and skipped all that, but, yes, TikTok can be banned from US commerce. Professor Chesney also explains the first option – forcing a sale – as well.
The interesting part is this, from the WaPo article:
Earlier in the day, the president had been considering an order that would force China’s ByteDance to sell off the U.S. portion of TikTok over national security concerns, but Trump later emphasized to reporters traveling with him that he did not support a deal to let a U.S. company buy TikTok’s U.S. operations.
Microsoft is still the leading contender to purchase TikTok if a deal goes through, according to people familiar with the talks, who spoke on the condition of anonymity to discuss private deliberations.
I suspect the matter is more delicate than the WaPo article suggests.
Trump is currently nettled concerning China because he views, wrongly or not, the Covid-19 pandemic as their fault. The WaPo article says as much.
If TikTok is forced to sell, a sale could be into a competitive market. That is, there may be several bidders for the TikTok entity, forcing the price so high that the current owners, ByteDance of China, would make out like bandits. That might lead to propaganda from China about Trump’s “assistance” in securing such a huge profit, which would be a lovely return volley in this tennis match. Trump would lose face[1] inside China as well as within the United States – he’ll be seen as being outfoxed by the Chinese.
I also included the paragraph on Microsoft being a prime bidder because Microsoft sits on a pile of cash, and if Microsoft did buy TikTok, that would bring Microsoft into the social media market. And Facebook might not like that. While Facebook has, of late, interfered with right wing propaganda, by and large they remain one of the largest purveyors of right wing propaganda in the social media space. On balance, Trump or his allies may not wish to alarm Facebook’s CEO, Mark Zuckerberg, by presenting him with a well-funded competitor with a long history of success. The Zuck might suddenly implement more stringent filters on right wing propaganda, and that would not work in Trump’s favor.
In order to avoid all of that, a simple ban on doing business must instead be used. It doesn’t stop a sale in and of itself, but it does decrease the urgency. And a sale might be banned, even if it was done on fallacious grounds.
I suspect the Trump Administration is trying to perform a highwire act in which the lead aerial performer has proven himself dreadfully inadequate in the past. Can they pull this one off?
