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China Still Won’t Approve the TikTok sale, Says it’s an Extortion

TikTok - Appy Pie

The September 20 deadline for the TikTok sale has already passed, but the companies involved in it have yet to settle terms on the deal. TikTok’s bidders Oracle and Walmart presented conflicting messages on the future ownership of the app, confusing investors and users. Over this, Beijing’s discontent with the TikTok sale was obvious.

Yesterday there were speculations that China will not approve the deal and a state-backed Chinese newspaper said that they had carried an editorial on the issue and today China has confirmed the same.

China Daily, an official English-language newspaper of the Chinese Communist Party in an editorial slammed and said, “China has no reason to approve the dirty and unfair deal that allows Oracle and Walmart to efficiently take over TikTok based on bullying and extortion.”

The editorial further said that Bytedance, the owner firm of TikTok, will lose not only control of the company, but also its core technology that it has created and owns. It also said that China has no reason to give the green signal to such a deal.

The editorial also argued that TikTok’s success projected revenue of about a billion dollars by the end of 2020 has apparently made US feel uneasy and encouraged it to use national security as the base to ban TikTok, the short video sharing app.

The three firms involved in the deal have issued conflicting statements over the terms of an agreement they hope will allow ByteDance’s video app TikTok to continue to operate in the US, where the government plans to ban the app on security grounds.

ByteDance has said it will establish a US subsidiary called TikTok Global of which it will own 80 percent. Oracle and WalMart, however, remarked that the majority ownership of TikTok Global would be in the US hands, complying with the executive order by US President Donald Trump that ByteDance abandon its ownership of TikTok within 90 days.

Chinese Government has already altered a set of export rules to complicate the potential TikTok deal, restricting the sale of certain AI-technologies to foreign companies. Both ByteDance and China’s state media have said the deal won’t involve technological transfers.

Just before the proposed September 20 deadline for the app ban, China’s Commerce Ministry called on the US to give up its bullying acts towards TikTok.

After the US announced a set of harmful curbs on telecoms equipment giant Huawei last year, China vowed to publish an unreliable entity list targeting foreign companies and individuals that do not comply with market rules and seriously damage the legitimate rights of Chinese enterprises, but it is yet to reveal the list.

TikTok has collected nearly 198 million App Store and Google Play installs in the US, according to market research firm Sensor Tower.

Doubts about the deal for the video app TikTok were fueled earlier this week after President Donald Trump said he may not approve it, and China’s government signaled unwillingness through official media.