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Aug 13, 2020

The United States bans TikTok, which may cut its connection with advertisers

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According to a White House document seen by Reuters, US President Trump’s executive order to ban TikTok in China may prohibit US app stores from providing this short video application and make it illegal to advertise on its platform.

The executive order signed by Trump last week requires that if TikTok’s parent company ByteDance does not reach a divestiture agreement within 45 days, it will prohibit any transactions related to TikTok. The decree did not specify the scope of the ban, only that the US Department of Commerce will determine which transactions are banned at the end of the 45-day period.

This White House document distributed to supporters last week provides clues to the thinking of the Trump administration. The document shows that the U.S. government is considering obstructing TikTok’s main operations and funding, because of concerns about the security of the personal information it processes.

“Prohibited transactions may include, for example, an agreement for an app store to provide TikTok applications…purchase of advertising space on TikTok, acceptance of terms of service for downloading TikTok applications,” the document said.

A source confirmed the authenticity of this White House document. TikTok did not immediately respond to a request for comment. Some tech industry experts said that banning TikTok from the app stores of Apple and Alphabet Inc’s could severely disrupt its growth.

“This will kill TikTok’s U.S. business,” said James Lewis, a cybersecurity expert at the Center for International Strategic Research in the United States. “These regulations are a huge obstacle if they want to grow.”

However, he added that the US government may not be able to prevent Americans from downloading TikTok from foreign websites.

Apple and Alphabet did not immediately respond to requests for comment.

After Trump issued an executive order last week, TikTok told advertisers that it will continue its planned advertising campaigns, refund any plans that cannot be completed, and cooperate with major influencers to migrate if prohibited. To other platforms. Some advertisers told Reuters that they are drafting contingency plans and are considering using other apps for marketing.

It is not clear whether Trump’s executive order will be implemented. Under the supervision of the Trump administration, Microsoft has taken a leading position in negotiations to acquire TikTok’s North American, Australian, and New Zealand businesses. If the two parties successfully reach an agreement, then prohibiting transactions with TikTok will actually become meaningless.

According to White House documents seen by Reuters, it is unclear whether the United States will launch a similar crackdown on WeChat. Trump issued an executive order last week to prohibit any person or company under US jurisdiction from conducting any transactions with TikTok owner Bytedance and WeChat owner Tencent Holdings after 45 days.

ByteDance said it was “very shocked” by the US ban and would resort to US courts if it cannot be treated fairly. TikTok has 100 million active users in the United States and is especially popular with teenagers. TikTok said that the data of US users are stored securely in the US and Singapore, and user data is not shared with the Chinese government.

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