Skip to content

New Rules In China Could Affect TikTok Sale To A Company In The U.S.


China has announced new technology export rules that could affect the sale of TikTok to a company in the U.S.

As we have previously reported TikTok is in the process of selling. ByteDance which is the Beijing based company that owns TikTok has been in talks with various companies including, Microsoft, Twitter, Netflix, Oracle, and even Walmart.

President Trump has been unhappy with the idea of TikTok being bought by an American company due to security reasons and on the 6th of August, he signed an executive order blocking all transactions with ByteDance and demanded that an American company purchase TikTok’s US business.

Then on the 14th of August Trump signed an order giving ByteDance 90 days to sell or spin-off TikTok in the U.S.

On Friday the 28th of August China updated its export control rules to cover a variety of technologies it deemed sensitive, including technology that sounded a lot like TikTok’s personalized recommendation engine. New restrictions and bans were issued on tech exports, requiring companies to seek government approval – a process that can take up to 30 days. These rules hadn’t been updated since 2008, which is suspicious and is believed to be a move against Trump’s earlier ruling.

Then on Saturday, a published commentary by a professor in China stated that the new rule would mean that ByteDance might actually need a license to sell its technology to an American company.

New Rules In China Could Affect TikTok Sale To A Company In The U.S.

There were Some technologies that were removed from the list of regulated exports, including vaccine technologies, but the 23 new additions included tech relating to AI interfaces, voice recognition, and content recommendation analysis.

The move from Beijing will ensnare TikTok and any potential American buyers, wedging them in a struggle between China and the U.S. over the future of global technology. 

A senior adviser at the Washington-based Center for Strategic and International Studies who studies Chinese Economic policies has stated: “At a minimum, they’re flexing their muscles and saying, ‘We get a say in this and we’re not going to be bystanders.’”

ByteDance has said that it was aware of the new rules and “strictly abide by the regulations”.

All this disruption has already caused upheaval inside ByteDance as just last week TikTok’s recently appointed chief executive, the former Disney executive Kevin Mayer, resigned citing the political situation.

Who knows what the future will hold for this technology giant, but you can be sure that we will be keeping you up to date with all the latest news on this ongoing issue.