A deal that would give Oracle and Walmart ownership stakes in TikTok is up in the air — and may not happen at all, as the Biden administration reviews Trump’s actions and policies against Chinese tech companies, according to a new report.
Last summer, Trump ordered Chinese internet giant ByteDance to sell TikTok, its hugely popular short-form video app, to U.S. owners, citing alleged risks to national security. Under the threat of TikTok’s shutdown in the U.S., ByteDance inked a tentative deal with Oracle and Walmart, which would acquire minority stakes in TikTok under the proposed terms.
Now that Trump is gone from the White House — and his order requiring ByteDance to divest TikTok to American investors is pending a court challenge — the TikTok/Oracle/Walmart deal has been “shelved indefinitely,” the Wall Street Journal reported.
TikTok and Oracle didn’t respond to requests for comment. A Walmart rep declined to comment.
Discussions between TikTok and the Committee on Foreign Investment in the U.S. (CFIUS), which has the authority to block foreign investments involving U.S.-based entities, have continued. One potential solution to address worries over the Chinese government’s access to TikTok user data would involve having a “trusted third party” manage TikTok’s data — a step that wouldn’t require a sale, according to the WSJ report.
Federal courts have ruled that Trump overstepped his authority in ordering TikTok to shut down, finding the administration’s hypothetical concerns about TikTok’s security risks unconvincing.
At this point, it’s unknown whether the Biden administration will try to enforce previous administration’s divestiture order involving TikTok or seek some other outcome. Any sale to U.S. would require approval from the Chinese Communist Party, which has signaled opposition to any such deal.
More broadly, the Biden administration is undertaking a review of the U.S.’s policy and approach to dealing with Chinese technology firms, per the Journal.
“We plan to develop a comprehensive approach to securing U.S. data that addresses the full range of threats we face,” a National Security Council spokeswoman said in a statement to the Journal. “This includes the risk posed by Chinese apps and other software that operate in the U.S. In the coming months, we expect to review specific cases in light of a comprehensive understanding of the risks we face.”