By Reuters | Updated: April 24, 2024
WASHINGTON, April 23 (Reuters) – The U.S. Senate on Tuesday passed legislation giving TikTok’s Chinese owner, ByteDance, about nine months to divest the U.S. assets of the short-video app, or face a nationwide ban. President Joe Biden said he will to sign the bill into law on Wednesday.
Here is what will likely happen next for TikTok.
TIKTOK CLOCK STARTS
Once Biden signs the bill, a 270-day clock starts during which ByteDance must sell TikTok. If it looks like ByteDance is close to divestment near the end of the nine-month period, the president can authorize an additional 90 days for any deal to be finalized. If the bill is signed into law this week, as expected, the 270-day period will end around the inauguration of the next president of the United States, on Jan. 20, 2025, leaving the decision on an extra three months either to Biden, a Democrat, who is seeking reelection, or Republican front runner Donald Trump.
TIKTOK SUES
Once the bill is signed into law, TikTok is expected to sue to stop it. TikTok’s lawyers are also expected to ask the court for a preliminary injunction.
TikTok would want an injunction barring enforcement of the law to allow its full case challenging the constitutionality of the law to move ahead. It is unlikely that the court proceeding would be complete by year-end.
Last year TikTok took similar legal actions to stop a ban on the app in the state of Montana, where a preliminary injunction was granted. If that scenario is any guide for TikTok’s efforts against the United States, the company itself and TikTok users will file separate cases to thwart the U.S. bill.
The bill sets the U.S. Court of Appeals for the D.C. Circuit as the exclusive forum for any legal challenges.
HOW LONG WILL THIS ALL TAKE?
If TikTok successfully obtains a preliminary injunction from the court, the forced sale process is halted, potentially giving TikTok more time to operate freely in the U.S.
In August 2020, Trump, who was president at the time, sought to ban both TikTok and Chinese-owned WeChat, but was blocked by the courts. In June 2021, Biden withdrew a series of Trump-era executive orders that sought to ban new downloads of WeChat and TikTok.
WILL TIKTOK CHANGE AT ALL?
The TikTok app should not change for its 170 million U.S. users between now and the end of the divestment period in the first four months of 2025.
WHAT DOES THE CHINESE GOVERNMENT SAY?
China has a list of technologies that would need Chinese government approval before they are exported. Experts said TikTok’s recommendation algorithm would fall under the list.
@ Thomson Reuters 2024
