ByteDance gets 90 days to sell TikTok

US President Donald Trump issued an executive order late on Friday giving ByteDance, the Chinese parent company of TikTok, 90 days to sell the popular video-sharing app.

This latest order comes a week after the president signed two orders prohibiting US companies and individuals from conducting transactions with TikTok and WeChat over national security concerns. The prior orders take effect on Sept 20.

Trump again in the new order cited the same rationale, saying: "There is credible evidence that leads me to believe that ByteDance… might take action that threatens to impair the national security of the United States."

The order also requires Byte-Dance destroy all data of US users collected on TikTok's platform and inform the Committee on Foreign Investment in the United States, or CFIUS, when it has destroyed all that data.

Microsoft, the leading bidder to acquire TikTok's US operations, has said negotiations with ByteDance could be completed by Sept 15, ahead of the prior deadline.

"Executive orders could be superseded by another executive order that changes or softens the policy. The thing that's important to watch is which of the agencies are given the authority to take action," said Melissa Hathaway, an expert in cyberspace policy and cybersecurity.

TikTok is working to challenge the legality of Trump's orders through a lawsuit, according to NPR citing an unnamed lawyer working for the company.

Another lawyer, Mike Godwin, said in a tweet that he's representing a TikTok employee to sue the Trump administration, because under the initial order, TikTok employees would lose their paychecks on Sept 20 and it violates the employees' constitutional rights, including to the right to be paid.

The Trump administration has been scrutinizing TikTok for months, claiming that the platform shares the data of US users with the Chinese government, despite the company's repeated denial of the accusation.

'Tech fear' and 'future fear'

CFIUS, a multiagency group that reviews mergers for national security threats, opened an investigation in November into ByteDance's takeover of Musical.ly in 2017. The acquisition led to the current version of TikTok.

Experts in the cybersecurity space said the administration lacked transparency and evidence to back its claims.

The White House is currently defining national security issues very broadly, and that might reflect "a tech fear and a future fear" beyond the current issue itself, said Hathaway.

Gary Rieschel, a US venture capitalist who founded Qiming Venture Partners in Shanghai, said: "I look at TikTok again, there's no real history of turning data over to the Chinese government."

There's nothing in TikTok's ownership structure to cause concerns－most of the investment in Byte-Dance and TikTok are international funds, with firms like Sequoia Capital, Hillhouse and SIG as primary investors, said Rieschel.

At the same time, Hathaway argued that the current conversation around TikTok should be much more transparent－not just about the US and China, but about the apps broadly.

"The conversation needs to be about the data, not about the app, or the company, because that's what it's really coming down to－the data flows, the access to that information and what you can do with it," she said.

Steve Orlins, president of the National Committee on US-China Relations, noted that the current issues with TikTok and WeChat also reflect the Trump administration lacking expertise on China.

"I actually don't agree with that assumption that the Chinese companies would not resist the request of the Chinese government (to send data back to China)," said Orlins at a recent webinar hosted by his organization.