The US House of Representatives passed the RESTRICT Act law in a landmark and highly controversial bill that could see wildly popular social media platform TikTok banned from all US-based devices.
The Act empowers the White House, via the Commerce Department, to investigate and enact mitigations powers on any company they consider to be a security risk.
The powers include the ability to ban not just applications like TikTok, but gaming applications and payment processors – potentially opening the door to go after cryptocurrency exchanges and the like.
The bill is far-reaching, applying to "past, present, AND FUTURE transactions” which encompasses just about anything the White House wants it to.
Commentators speak out
There is a high level of controversy around this bill, which would give TikTok owner ByteDance – which has connections to the Chinese Communist Party – six months to sell off its holding in the social media platform before the Commerce Department steps in.
Users have taken to the platform to express their consternation and frustration with the decision, describing the vote for the bill as a “vote to ban the complaint box, rather than listen to a single complaint on this… app.”
@pearlmania500 Its a big club and you aint in it - George Carlin #keeptiktok #congress #news #tiktokban #pearlmania500 #rant #makeup #work #politics ♬ original sound - Pearlmania500
Compounding the fears over censorship, the RESTRICT Act is immune from Freedom of Information Act (FIOA) requests, meaning its impossible to find out when or how the powers might be used.
Nevertheless, the bill has bi-partisan support – passing with 352 votes to 65 – including from Biden’s administration itself.
Mike Gallagher, a Wisconsin Republican who co-authored the bill, said the US could not "take the risk of having a dominant news platform in America controlled or owned by a company that is beholden to the Chinese Communist Party".
Top House Democrat Hakeem Jeffries also offered his support, saying it would reduce “the likelihood that TikTok user data is exploited, and privacy undermined by a hostile foreign adversary”.
The White House’s statement described the bill as a “a systematic framework for addressing technology-based threats to the security and safety of Americans.”
TikTok chief executive Shou Zi Chew said the company was committed to keeping its data secure and the platform "free from outside manipulation".
So, is TikTok doomed?
Betting sites like Manifold and Metcalculus have given the bill a 70% chance of passing the US Senate – take that as you will.
Given its strong bipartisan support, it seems very likely.
From there, TikTok owner ByteDance has two options – either sell its stake in the company or allow the Commerce Department to intervene, after which the app will be removed from US marketplaces, or the company will be forced to sell anyway.
Former Treasury Secretary Steven Mnuchin is betting TikTok will not go the way of Vine – last night he stated his intention to put together an investor group to buy the social media platform.
“This should be owned by US businesses,” Mnuchin said. “There’s no way that the Chinese would ever let a US company own something like this in China.”
It’s likely to be difficult to raise the required funding, however, and big tech companies are better positioned to take up the challenge financially.
That has its own issues with anti-competition monopolisation however, as Mnuchin acknowledges.
“I don’t think this should be controlled by any of the big US tech companies. I think there could be antitrust issues on that,” he said during a CNBC interview.
“This should be something that’s independent, so we have a real competitor. And users love it, so it shouldn’t be shut down.”