TikTok may challenge US order banning transactions with its Chinese parent ByteDance
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TikTok's legal challenge pertains to an executive order, which Trump issued on August 6. The said order directed the Secretary of Commerce to come up with a list of transactions involving ByteDance and its holdings that should be banned after 45 days.
TikTok is set to mount a legal challenge to US President Donald Trump's executive order prohibiting transactions with the popular short video app and its Chinese parent ByteDance.
TikTok's legal challenge pertains to an executive order, which Trump issued on August 6. The said order directed the Secretary of Commerce to come up with a list of transactions involving ByteDance and its holdings that should be banned after 45 days.
TikTok plans to argue that the August 6 executive order's reliance on the International Emergency Economic Powers Act deprives it of due process. TikTok will also contest its classification by the White House as a national security threat, the sources added.
US officials have expressed concerns that information on users could be passed on to China's communist governmen from TikTok.
The Trump administration has stepped up its efforts to purge what it deems "untrusted" Chinese apps from US digital networks. Beyond TikTok, Trump has also issued an order that would prohibit transactions with Tencent Holding Ltd's WeChat.
Trump has said he would support an effort by Microsoft to buy TikTok's American operations if the US government got a "substantial portion" of the proceeds, but has also said there are other interested potential buyers such as Oracle.
Trump also issued an executive order on August 14 that gave ByteDance 90 days to divest the US operations of TikTok.
To this end, ByteDance has been making progress in talks with potential acquirers, including Microsoft Corp and Oracle. Some of ByteDance's US investors could also join the winning bid.