WSJ US BusinessBiden Revokes Trump Actions Targeting TikTok, WeChat

June 9, 20210
https://www.gmi-co.com/wp-content/uploads/2021/06/biden-revokes-trump-actions-targeting-tiktok-wechat.jpg

WASHINGTON—President Biden revoked a Trump -era attempt to ban Chinese-owned apps TikTok and WeChat, substituting Wednesday an executive order mandating a broad review of apps controlled by foreign adversaries to determine whether they pose a security threat to the U.S.

The new order doesn’t target any companies specifically, but creates the potential for an even broader crackdown on Chinese-owned apps than the Trump administration orders it replaces by mandating a review of all software applications with potential ties to countries such as China.

The Commerce Department was authorized to begin that review immediately, the White House said.

The executive order is designed to replace the Trump administration’s approach targeting individual companies with a broader process for reviewing risks posed by foreign-owned apps, according to senior Biden administration officials. The officials say the executive orders signed by former President Donald Trump were effectively unenforceable.

The officials say they remain concerned about security risks from Chinese and certain other foreign-owned apps, but that the executive orders signed by former President Donald Trump were effectively unenforceable.

Federal court rulings had blocked Mr. Trump’s orders from ever taking effect. In the case of TikTok, he had sought to shut down the app in the U.S. if the company wasn’t put under control of U.S. owners.

Sen. Josh Hawley (R., Mo.) framed Mr. Biden’s action as a retreat, however, tweeting on Wednesday: “This is a major mistake—shows alarming complacency regarding #China’s access to Americans’ personal information, as well as #China’s growing corporate influence.”

But others viewed it as a positive step.

“This is important because it signals an alignment of concern across two administrations on these issues, but also because the new administration is clearly moving from a review phase to more of an action phase,” said Eric Sayers, a U.S.-China tech expert at the American Enterprise Institute.

TikTok, owned by Beijing-based ByteDance Ltd., declined to comment. The popular video-sharing app has an estimated 100 million users in the U.S.

WeChat, a multipurpose app popular in China that is owned by tech giant Tencent Holdings Ltd. , didn’t respond to a request for comment.

China’s U.S. embassy spokesman, Liu Pengyu, said in a statement that China “opposes the U.S. abusing its national power under the pretext of national security to suppress and coerce non-American companies.”

“We urge the U.S. government to provide an open, fair, just and nondiscriminatory business environment for foreign companies,” the statement said.

Wednesday’s executive order requires the Commerce Department to review apps developed or owned by people or companies “subject to the jurisdiction of a foreign adversary, including the People’s Republic of China,” according to a White House fact sheet.

The review would include apps that could be used to support military or intelligence activities by other countries, or could be used to collect sensitive personal data, the White House said.

U.S. officials have maintained that TikTok, WeChat and other Chinese-owned apps collect data that could be shared with China’s authoritarian government. Those companies have disputed that contention.

The Biden executive order also revokes a Trump-era ban affecting the Alipay payment platform, which is owned by Chinese billionaire Jack Ma’s Ant Group Co., and apps owned by Shenzhen-based Tencent—WeChat Pay, QQWallet and Tencent QQ.

Ant Group declined to comment.

In addition, the Trump order applied to Camscanner, a scanning app owned by INTSIG Information Co. in Shanghai, as well as Chinese-connected apps known as SHAREit, Vmate and WPS Office.

The WeChat app, in particular, is widely used by U.S. companies that do business in China. The U.S.-China Business Council, which represents many of those companies, said it didn’t have enough information about the new executive order to comment on the security provisions.

But the group did say the White House should work to establish global agreements on data flows and privacy.

“Without international agreements, there’s a real danger that individual country data flows and privacy protection policies will throttle innovation, cripple the Internet of things, and adversely affect future US and global economic growth,” the group said in a statement.

The Wall Street Journal reported in February that the Biden administration had shelved the Trump administration’s plan to force a sale of TikTok amid ongoing legal challenges.

At the time, the Biden administration said it was developing a comprehensive approach to protecting data security, and was reviewing the previous administration’s action to determine whether the national security threat cited by Mr. Trump continued to warrant an outright ban.

The Chinese-owned app TikTok has been labelled a national-security threat by the U.S., but it’s not unique in the data it collects. WSJ explains why countries are building digital walls and treating user data like a sovereign asset, and how that could change our tech. Illustration: Zoë Soriano

In April, ByteDance named Shou Zi Chew as TikTok’s new chief executive, replacing former YouTube executive Vanessa Papps, who became TikTok’s interim head in 2020 after the abrupt resignation of former Walt Disney Co. executive Kevin Mayer. Executives at TikTok said they interpreted the ascension of Mr. Chew, who is based in Singapore, as an indication that TikTok no longer viewed its relationship with the U.S. as its greatest risk.

U.S. administration officials said Wednesday that TikTok continues to undergo a separate review by a government panel that reviews cross-border business deals on the basis of national security.

James Lewis, a China tech expert at the Center for Strategic and International Studies, said if the panel review doesn’t produce a settlement, “TikTok should expect to be back on the chopping block,” facing the same pressures in a Commerce Department review as it did during the Trump administration.

The new order also seeks recommendations on further toughening of the U.S. approach to protect sensitive data such as genetic information. Administration officials say they also plan to seek more involvement of other friendly countries in its efforts to police data practices of apps based in potentially unfriendly countries.

The action is the latest sign of the Biden administration’s emerging China policy, which represents a tougher approach acknowledging Beijing’s economic and geopolitical strength.

In March, the U.S. joined allies in imposing sanctions against Chinese officials engaged in the mass incarceration of mainly Muslim ethnic minorities in the Xinjiang region.

Last week, the president expanded a Trump-era prohibition on Americans investing in Chinese companies with purported links to China’s military. Many of the newly targeted companies are subsidiaries and affiliates of major state-owned companies and other businesses named on the earlier blacklist.

The U.S. also is working on supply-chain issues intended to lessen the dependence on China, and on Tuesday the Senate approved a $250 billion bill boosting government spending on technology research and development amid rising competition from China and other nations.

Mr. Biden departed Wednesday for his first overseas trip as president and will meet with European and NATO leaders as well as a summit with Russian President Vladimir Putin. Part of his aim, officials said, will be to rally allies into taking on Beijing.

Social-Media Scrutiny

More WSJ coverage of Trump’s TikTok ban, selected by the editors.

Write to John D. McKinnon at john.mckinnon@wsj.com and Alex Leary at alex.leary@wsj.com

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Leave a Reply

Your email address will not be published. Required fields are marked *

700 Louisiana Street , Houston TX. 77002
(+1) 832-390-2738
info@gmi-co.com

Follow us:

FREE CONSULTATION

Calls may be recorded for quality and training purposes.

Copyright © GMI 2020