Trump Administration to Conduct National Security Review of TikTok Sale to Oracle

The TikTok logo is displayed on a smartphone while on the U.S. flag, November 8, 2019. (Dado Ruvic/Reuters)

Treasury Secretary Steven Mnuchin said Monday that the Trump administration will conduct a national security review of the sale of TikTok to Oracle, which won the bidding war for the video-sharing app’s U.S. operations.

ByteDance, TikTok’s Beijing-based parent company, has accepted an offer from Oracle, a tech firm based in California, to buy TikTok’s U.S. operations. The announcement comes just one day ahead of the deadline that President Trump set for ByteDance to unload TikTok’s U.S. operations or risk being blacklisted in America. The Chinese company rejected a joint buying offer from Microsoft and Walmart.

Mnuchin told CNBC that the deal will undergo a review by the Committee on Foreign Investment in the U.S. as well as a “national security review under the president’s executive order.”

“We did get a proposal over the weekend that includes Oracle as the trusted technology partner, with Oracle making many representations for national security issues,” Mnuchin said, adding that, “there’s also a commitment to create TikTok Global as a U.S.-headquartered company with 20,000 new jobs.”

“We will be reviewing that at the CFIUS committee this week, and then, we will be making a recommendation to the president and reviewing it with him,” the treasury secretary said.

In early August, Trump issued an executive order requiring ByteDance to find an American buyer for TikTok by September 15, and if they fail to secure a purchaser, Trump said he would shut down the app in the U.S. effective September 20.

“There is credible evidence that leads me to believe that ByteDance,” which is based in Beijing, “might take action that threatens to impair the national security of the United States,” Trump wrote in his executive order.

Several Trump administration officials, including Secretary of State Mike Pompeo and John Demers, the assistant attorney general of the National Security Division, have warned about national security threats posed by TikTok, saying the Chinese government could be collecting the data of Americans.

“A critical factor for us driving national security is making sure the technology on Americans’ phones is safe and making sure it is not corrupt,” Mnuchin said. “We have a lot of confidence in both Microsoft and Oracle. They’ve chosen Oracle. We’ll be reviewing it with their technical teams and our technical teams to see if they can make the representations we need.”

Microsoft released a statement on Sunday saying that “ByteDance let us know today they would not be selling TikTok’s U.S. operations to Microsoft,” and adding, “we are confident our proposal would have been good for TikTok’s users, while protecting national security interests.”

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