The parent company of Chinese short video sharing app TikTok, ByteDance, has submitted a technology export license application to Chinese authorities. According to the Wall Street Journal, the move would officially put the fate of the deal between TikTok and U.S. companies Oracle and Walmart in the hands of Chinese authorities.
The application has been submitted to the Beijing Municipal Bureau of Commerce and is awaiting its decision, according to a statement published Thursday (Sept. 24) by the word hopper in its general news outlet Headline News.
However, the statement made no mention of ongoing negotiations in the United States regarding TikTok’s U.S. business.
Last month, China’s Ministry of Commerce revised its technology export control list to include the TikTok app’s use of a user preference recommendation algorithm. Experts believe that Beijing’s move will give it a say in the TikTok deal.
Chinese Commerce Ministry spokesman Gao Feng said Thursday that the Beijing Municipal Bureau of Commerce has received a technology export license application from ByTek. He said at a press conference the same day: “It is understood that the Beijing Municipal Bureau of Commerce has received the technology export license application submitted by Byte Jumping, and will follow the relevant regulations and procedures to process it in accordance with the law.”
The Beijing Municipal Bureau of Commerce generally has to make a preliminary ruling on technology export applications within 30 days.
In a statement issued Thursday, BytePop did not mention what technology it was applying for an export license for.
However, Beijing-based Byte Jump had previously said that the deal between Tiktok and Oracle and Walmart was not a sale deal but a partnership deal, so there was no technology export issue. The newly formed company, TikTok Global, will be an independent company. Oracle will have access to TikTok’s U.S. source code.
Byte Jump has also said that the deal needs to be approved by the U.S. and Chinese governments.
So far, however, BytePop and Oracle, as well as the U.S. government, have been at odds over the details of the deal.
BytePop says it will own 80 percent of TikTok Global. Oracle and Walmart, on the other hand, say that the new company’s controlling interest is in the hands of U.S. companies, which is in line with an executive order issued by President Trump on August 14. The executive order calls for Byte Jumping to relinquish its ownership of TikTok within 90 days. Oracle holds a 12.5 percent stake and Walmart has a 7.5 percent stake.
There is a theory that half of the 80 percent stake held by ByteTok comes from investments by some other U.S. companies. In this scenario, the U.S. side would hold about 53% of the equity.
The deal is currently under review by the White House, and the issue of equity allocation is still being coordinated. Trump recently made it clear that the new company must be owned by a U.S. company, or he will not approve it.
The official Chinese media, China Daily and Global Times, reported this week that the Chinese government had no reason to accept the deal, which they said was based on “bullying” and “extortion.
On the other hand, TikTok filed for an injunction with a U.S. federal judge on Wednesday to stop Trump’s “blocking order” before the deadline (Sept. 27).
According to Chinese media reports, TikTok argued in its brief to the court that Trump’s executive order is unconstitutional, including violating the First Amendment and due process of law.
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