(Bloomberg) — For TikTok, time is running out in its existential struggle to avoid a U.S. ban.
Most read on Bloomberg
Legislation forcing the social media app’s Chinese owners to divest their business has passed Congress, and passed the Senate late Tuesday, as part of a broader foreign aid package. President Joe Biden plans to sign it on Wednesday – triggering a 270-day countdown to a U.S. sale or ban of the popular video-sharing platform.
TikTok and Beijing-based ByteDance Ltd. have pledged to do everything possible to end the measure. They argued that it violated the free speech rights of the app’s 170 million monthly users in the United States and were considering suing to overturn the law or at least delay its enforcement.
“We will continue to fight,” Michael Beckerman, TikTok’s head of public policy for the Americas, said in a memo to U.S. staff last week. “This is the beginning, not the end, of this long process.”
Biden’s signing will end years of scrutiny in Washington, where regulators and lawmakers from both parties have expressed growing concern that Chinese ownership of TikTok poses a risk to U.S. national security. Supporters of the bill say the Chinese government is using TikTok as a propaganda tool and could demand that ByteDance share U.S. user data — allegations that the company and Beijing officials have denied.
As the legal battle is set to unfold, US TikTok users face a wave of uncertainty over where to express themselves via video, make money as influencers or sell products on TikTok Shop. If implemented, a TiKTok ban would risk disrupting “a critical channel for engaging with younger audiences and building brand visibility,” said Damian Rollison, director of market research at SOCi.
“TikTok’s unique format has allowed businesses to showcase their products and services in creative ways, leveraging trends and user-generated content to connect with potential customers,” Rollison said.
TiKTok made economic arguments against the law, saying content creators and merchants who make a living from posting videos and selling products would be financially impacted. While many U.S. lawmakers who supported the recently passed federal bill believe it would withstand scrutiny in courts, some rights groups say the First Amendment will be a tougher hurdle to clear.
“The U.S. government can say that a foreign company cannot do business in the United States. It’s just more difficult when the foreign company is a communications system that U.S. users use to communicate with each other.” , David Greene, director of civil liberties at the Ministry of Foreign Affairs. Electronic Frontier Foundation, said in an interview. “It just poses different legal issues.”
When Montana passed a law in 2023 that would ban TikTok in the state, the company and a group of content creators sued in separate claims, claiming the state measure violated the rights to free expression under the First Amendment of the United States Constitution. The company funded the users’ lawsuit, according to the New York Times. The judge…
