The controversial push to force Chinese tech unicorn ByteDance to surrender some or all of its smash hit TikTok The social media service for a US-based company may be in doubt after a report today indicated that the Chinese government may oppose the transaction. According to Reuters, the Chinese government may prefer TikTok to just close its operations in the United States rather than allow it to be sold to an American company.
The potential divestiture of TikTok is not a normal business transaction. Instead, the deal is required by the US government, as President Donald Trump directs foreign and economic policy via executive fiat. Leaning on his legendary business acumen, the US premier also asked his government to receive a portion of the final sale price. It is unclear whether this concept is legal.
As the US and China struggle around the world for both economic and political supremacy, the deal is a tipping point between countries with a mess of companies stuck in the middle. ByteDance is in the mix, along with Microsoft, Walmart and other companies to a lesser extent, such as Oracle. The Trump administration has set a mid-September timeline for concluding a deal, although as the month burns it is unclear whether that timeline could be met.
The US isn't alone in taking steps to curb Chinese influence within its borders, as the sale of TikTok comes after India banned the app, along with dozens of other China-based apps. .
The deal is also under pressure from an evolving regulatory environment in China, with the country's autocratic leadership modifying its export rules to possibly include elements of TikTok that could limit a transaction and possibly sink its sale.
For ByteDance, the situation is a nightmare. For Microsoft's main suitor, the transaction is a shooting wedding that he may not be entirely thrilled with. For the Trump administration, it is an attempt at a power play. And for the increasingly authoritarian Chinese government, the deal might seem like a submission. So, if the deal comes to an end, it will be more of a surprise than an eventuality.
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