China has spoken out against any forced sale of TikTok, following demands from the US Biden administration that its Chinese owners sell their share of the company or face a ban in the US. This is the first direct response from China on the matter. TikTok CEO Shou Chew testified in front of US lawmakers due to mounting scrutiny over the app’s ties to Beijing.
China’s commerce ministry expressed concerns that a forced sale of TikTok would seriously damage global investors’ confidence in the United States. Spokeswoman for the ministry, Shu Jueting, said that if the news about a forced sale is true, China will firmly oppose it. She also emphasised that any potential deal would need approval from the Chinese government, as it involves technology export and administrative licensing procedures must be performed in accordance with Chinese laws and regulations.
Previously, Beijing did not give a direct response to the potential forced sale of TikTok. However, since 2020, it had indicated that it wanted to protect Chinese technology by adding recommendation algorithms, which could include TikTok’s, to a list of technologies restricted for export.
During Chew’s first congressional hearing, he tried to provide nuanced answers and ease lawmakers’ concerns about TikTok and its parent company, Bytedance. However, lawmakers interrupted him frequently and called him evasive. After more than five hours of testimony, the lawmakers expressed deep scepticism about TikTok’s attempts to protect US user data and ease concerns about its ties to China.
Experts predict that the US government will continue to push for a ban on TikTok if the company does not separate itself from its Chinese parent company. The Chinese government may have the power to veto the sale, as suggested by Shu’s latest response and previous actions taken by Beijing.
In December, Chinese officials proposed stricter rules for the sale of content-based recommendation algorithms to foreign buyers. These algorithms are believed to be crucial to TikTok’s success, as they keep users engaged by providing personalized recommendations based on their behaviour.
Chinese regulators first restricted the export of algorithms, including those used by TikTok, in August 2020, when the Trump administration threatened to ban the app unless it was sold. Analysts and legal experts speculate that Beijing may prefer for TikTok to leave the US market rather than give up its algorithm.