the times | Monday August 3 2020 2GM 33
Business
Simon Duke
TikTok is drawing up plans to break
free from its Chinese owner in an effort
to prevent Washington shutting down
the popular video-sharing app.
Bytedance, its Chinese parent, is
considering creating an independent
company that would take ownership of
TikTok’s overseas operations.
Under the plan, the new entity would
keep the TikTok brand, but would have
separate management and would no
longer answer to Bytedance, according
to Hong Kong’s South China Morning
Post.
The company has been scrambling
for its survival in recent days amid signs
that a mooted sale of its American
operations to Microsoft might not be
enough to satisfy Washington.
President Trump warned late on
Friday that he would sign an order to
blacklist TikTok on national security
grounds. He told reporters: “As far as
TikTok is concerned, we’re banning
them from the United States.” He
suggested that a sale of the US business
to Microsoft would not assuage his
concerns over the app.
Zhang Yiming, 37, the founder of
Bytedance, wants to retain an interest
in TikTok, which has been downloaded
two billion times and is the first Chi-
nese-owned app to become a global hit.
The tycoon is said to be resigned to
relinquishing control, knowing that a
US ban would destroy its business as
Google and Apple would have to
remove it from their app stores.
Mike Pompeo, the secretary of state,
warned yesterday that the United
States would take action imminently
on Chinese software companies that
fed data to Beijing. “President Trump
has said ‘enough’ and so he will take
action in the coming days with respect
to a broad array of national security
risks that are presented by software
connected to the Chinese Communist
Party,” he said in an interview.
Steven Mnuchin, the Treasury secre-
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Jul 3 13 21 29 Jul 2 13 21 29 Jul 3 13 21 29 Jul 3 13 21 29 Jul 3 13 21 29 Jul 3 13 21 29tary, has warned that the committee on
foreign investment in the US was
unanimous in its support for a crack-
down. “The committee agrees that Tik-
Tok cannot stay in the current format
because it risks sending back
information on 100 million Americans
[to China],” he said.
“The president can either force a sale
or the president can block the app...
and I’m not going to comment on my
specific discussions with the president,
but everybody agrees it can’t exist as it
does.”
Over recent months US officials have
said repeatedly that TikTok poses a
national risk because of the troves of
personal data it has collected on Amer-
ican users. Washington fears that it
could be used by the Chinese govern-
ment to spy on Americans or to spread
disinformation and propaganda.
TikTok, which allows users to create
and share short lip-sync and dance
videos, denies sharing data with the
Chinese authorities and insists that it
would ignore any order to do so.
“They’re true privacy issues for the
American people and, for a long time,
the United States just said, ‘Well, good-
ness, if we’re having fun with it, or if a
company can make money off of it,
we’re going to permit that to happen,’ ”
Mr Pompeo said.
Bytedance has been in talks to divest
TikTok’s US operations to Microsoft in
an attempt to strike a deal with the
White House. That offer has gained
some support from allies of the presi-
dent, including Lindsey Graham, the
Republican senator. However, it is un-
clear how it could split the US business
from the rest of its operations outside
China.
TikTok is the latest Chinese tech-
nology company to become embroiled
in the bad-tempered rivalry between
Washington and Beijing over trade and
technology. The US government has
successfully persuaded allies including
Britain to exclude equipment made by
Huawei in 5G mobile phone networks.Pompeo threatens curbs on Chinese tech firms
US ramps
up pressure
on Beijing
over TikTok
ZHOU YOU/VCG/GETTY IMAGESGame on Visitors to China Joy, the digital entertainment industry’s trade show in Shanghai, went as their favourite characterLiz Truss says that parliament is
“entirely able” to block post-Brexit
trade deals, despite warnings from
Conservative MPs that their counter-
parts in Washington and Brussels will
have more say.
The international trade secretary
said that MPs could resist free trade
agreements by rejecting relevant laws
and passing motions to halt their
progress.
Britain is chasing deals with the
United States, Japan and the European
Union. Ministers have sought to
dampen concern about concessions
made during negotiations, stating that
they would not drop a ban on chlor-
inated chicken and that any deals “must
protect our NHS”.
Senior Tories have demanded
specific votes on future accords, but Ms
Truss, who flew to Washington at the
weekend for talks, said that MPs were
already free to “block the ratification”
of pacts. Last week, she said: “It’s an im-Truss: MPs will get vote on trade deals
Callum Jones portant principle that parliament can
block a given [free trade agreement]
through the Constitutional Reform and
Governance Act process. It’s entirely
possible for parliament to block any
free trade deal. In addition, parliament
could also not vote for the domestic
legislation, any domestic legislation
required as well. Parliament is entirely
able to do that if it does not support a
given free trade agreement.”
The Constitutional Reform and
Governance Act does not provide
binary votes on treaties, but MPs can
stymie ratification by passing opposi-
tion motions.
Britain will be at “pretty much the
same level as Canada” in terms of
parliament’s ability to scrutinise pacts,
Ms Truss said, with a stronger system of
“checks and balances” than Australia
and New Zealand. Those calling on the
government to subject free trade agree-
ments to votes in the Commons say
that legislators in America, Japan and
the EU are granted such opportunities.
Ms Truss said that she was in her job“to get a good deal for British farmers, for
British business, for British consumers. I
don’t want to strike a deal that is not
going to command the support of
parliament, but there is that check and
balance in the system that parliament
can block the ratification of a free trade
deal.”
Last month Jonathan Djanogly, a
former Conservative justice minister,
launched an unsuccessful attempt to
ensure that all trade agreements faced a
parliamentary vote before they were
signed. A dozen Tory rebels backed his
proposal, including Theresa Villiers,
the former cabinet minister.
Mr Djanogly complained that the
procedures highlighted by Ms Truss
were “hopelessly out of date”. He said:
“Now that we have left the EU, the idea
that we should have less scrutiny than
the EU is a poor one. All of the legisla-
tors in the US, the EU and Japan will
have more access rights to negotiation
papers than UK MPs and they will get
a vote on approval of the draft deal. We
should have the same.”