The US Government will delay enforcing a ban on Chinese-owned video sharing platform TikTok.
The country’s Commerce Department said that it will not be enforcing an order that aimed to separate California-based TikTok from its China-based parent company Bytedance.
An executive order from US President Donald Trump had given TikTok a 12th November deadline to restructure itself and separate off its US operations, or else it would face legal sanctions.
The new move comes after an order on 30th October from a Pennsylvania court that staved off a Commerce Department order from August that would have brought sanctions against TikTok, barring US customers from making transactions with the platform.
However, on 12th November, the US Justice Department launched an appeal against that order.
In turn, TikTok has begun its own legal challenge over the ban and the delays in approving a divestment deal.
The current proposal set out by the company would see it divest operations and create a new entity, with major US companies Oracle and Walmart, along with existing US investors in ByteDance, wholly owning the company. This new entity would handle TIkTok’s US user data and content moderation.
Through a petition filed in the US Court of Appeals for the District of Columbia, TikTok claimed that the move violated its constitutional rights and asked for a court to review the divestment order.
“In the nearly two months since the president gave his preliminary approval to our proposal to satisfy those concerns, we have offered detailed solutions to finalise that agreement but have received no substantive feedback on our extensive data privacy and security framework,” a statement from TikTok read.
The company also claimed that it had asked the government to extend the deadline by 30 days due to additional deal requests and a lack of clarity on whether its proposed solutions were acceptable.
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TikTok has had a troubled history in the US. In late 2019, the app was subject to a lawsuit claiming that it was transferring data on its US users back to China.
This earned it the ire of US President Donald Trump, who appeared to make banning the app a major part of his tough-on-China stance. In August, he gave the company 45 days to find a buyer for its US operations or cease operating in the country. This deadline was later extended to 90 days.
Several major American tech companies were linked to the deal, including Microsoft, Oracle and Twitter.
With regime change in the US presumably just over two months away, a potential ban on TikTok appears to be in limbo.
There are still a few issues to resolve. With pressure from the Trump administration easing off, the impetus behind creating a spinoff company will largely disappear. Whether TikTok and Bytedance will continue their current corporate relationship or proceed with the spinoff to make international operations easier remains to be seen.