ISLAMABAD/WASHINGTON: China’s TikTok app is considering separating from parent ByteDance to help address United States (US) concerns about high national security risks, Bloomberg News reported on Tuesday, citing people familiar with the matter.
A divestiture that could result in a sale or initial public offering is considered a last resort and would be pursued only if the company’s existing proposal with US national security officials did not get approved, Bloomberg reported.
TikTok and ByteDance didn’t immediately respond to Reuters’ requests for comment.
The short-form video app is undergoing a national security review by the US Committee on Foreign Investment. It agreed the previous year to implement several measures under the plan, nicknamed “Project Texas,” to appease hostile US lawmakers.
According to the report, the US Committee on Foreign Investment has stalled the process, leaving TikTok unsure whether its plans will be enough to continue operating in the country.
US Committee on Foreign Investment members from the Justice Department have been unwilling to accept TikTok’s proposal.
Tik Tok app
TikTok, used by over 100 million Americans, has come under increasing fire over fears that user data could end up in the hands of the Chinese government, undermining Western security interests. TikTok Chief Executive Shou Zi Chew will appear before the US Congress next week.
In 2020, the US Committee on Foreign Investment, an influential national security body, unanimously recommended that ByteDance divest TikTok because of fears that user information could be passed on to the government of China.
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