TikTok Considers Ditching ByteDance To Address US National Security Concerns

JAKARTA - China's TikTok is mulling the idea of ​​breaking away from its parent company, ByteDance, to help address the United States' concerns about national security risks. This appeared in a Bloomberg News report on Tuesday, March 14 citing a source familiar with the matter.

Bloomberg also reported that the stock release, which could result in a sale or initial public offering, is considered a last resort and will be pursued only if the company's proposal with existing US national security officials is not approved. While TikTok and ByteDance did not immediately respond to Reuters' requests for comment.

The short video app is currently undergoing a national security review by the Committee on Foreign Investment in the United States (CFIUS) and they agreed last year to implement a number of actions in a plan dubbed "Project Texas", in a bid to appease hostile lawmakers.

CFIUS has stalled in the process, leaving TikTok unsure whether its plans will be sufficient to continue operating in the country, according to the report. CFIUS members of the Department of Justice were reluctant to accept TikTok's proposal.

TikTok, which is used by more than 100 million Americans, has come under increasing scrutiny over fears that user data could end up in the hands of the Chinese government, undermining Western security interests. TikTok's Chief Executive Officer, Shou Zi Chew, is scheduled to appear before the US Congress next week.

CFIUS, the powerful national security agency, in 2020 unanimously recommended that ByteDance should let go of TikTok out of fears that user data could be turned over to the Chinese government.

TikTok and CFIUS have been negotiating for more than two years on data security terms. TikTok says it has spent more than $1.5 billion on stringent data security measures and rejects the wiretapping allegations.