US Treasure Secretary warns TikTok will be shut down if Oracle deal is not closed, after reports China won’t approve sale
The sale of ByteDance’s TikTok operation took another twist this week after a senior US official warned the app would be closed down if the Oracle, Walmart deal is not closed.
US Treasury Secretary Steven Mnuchin was quoted by Reuters as telling a CNBC investor conference, that if Oracle’s deal for TikTok cannot be closed with terms that meet US security requirements, including holding source code in the United States, it be will be shut down.
It comes after TikTok temporarily avoided being banned in America earlier this week, when a US judge issued an injunction blocking the Trump administration order that would have barred Apple and Google’s app stores from offering the social media app.
“All of the code will have to be in the United States. Oracle will be responsible for rebuilding the code, sanitizing the code, making sure it’s safe in their cloud, and …it’ll satisfy all of our requirements,” reportedly Mnuchin said.
The US Commerce Department last week had delayed a decision on banning TikTok in the US by a week, after US President Donald Trump said he approves of TikTok partnership with Oracle and WalMart ‘in concept’.
That came after earlier concerns that the White House would find it difficult to approve the deal that saw Oracle becoming TikTok’s “trusted technology partner”.
Precise details about the deal have not been made public, but it is known the deal sees Beijing-based ByteDance retain a majority 80 percent stake in ‘TikTok Global’, which will reportedly create a headquarters in the United States.
This new company will also reportedly have a board of directors comprised mainly of Americans, but ByteDance will retain a 80 percent stake in the subsidiary.
White House Review
It came after US President Donald Trump on 6 August signed an executive order that would have prohibited US companies from carrying out TikTok-related deals with ByteDance after 45 days on national security grounds
A number of US firms were in the running to acquire TikTok’s operations, but after rejecting Microsoft’s approach, ByteDance revealed its partnership deal with Oracle and Walmart.
Yet despite the approval of the deal by President Trump, Chinese media reports have suggested Beijing is unlikely to sanction the “unfair” deal that would see Oracle and Walmart purchase minority stakes in TikTok Global.