In the heart of a high-tension political power-play between the United States and TikTok, the social media giant fired an explosive missive last Thursday that alleges political game-playing by the Biden administration in negotiations that underpin the company’s ability to operate in the U.S. This correspondence, directed towards the Justice Department’s senior official, David Newman, was made public due to the company’s case against a potential ban penned into legislation by President Biden.
This lawsuit, put forth by TikTok and its Beijing-based parent company, ByteDance, is gearing up to be one of the most significant legal standoffs in the history of the digital space. The fate of the internationally popular platform in America hangs in the balance.
A glimpse behind the scenes reveals a year-long negotiation process between TikTok and the ever-watchful Committee on Foreign Investment in the United States (CFIUS), an interagency board that scrutinizes corporate contracts for potential threats to the nation. Throughout the duration of the talks, which lasted from January 2021 to August 2022, the committee’s approval for TikTok’s continuation in the U.S, appeared to hang on a wire.
Advocating for a more stringent approach to their data safety, CFIUS proposed an extended- 90 page security agreement. This document contained a series of safeguarding measures around the handling of U.S. users’ data, crucially including a ‘kill switch.’ This feature would enable the U.S. government to instantaneously halt TikTok’s operations were they found to be in violation of the agreement.
Yet, in August 2022, following the submission of the proposed security agreement’s draft version, TikTok’s legal representation claims that CFIUS abruptly ended all primary discussions. There was no immediate response from CFIUS to these accusations. Yet, the Justice Department emphasised their dedication to defending new legislation they believe tackles significant national security issues in a First Amendment and constitutional-friendly manner.
This brew of rising tensions incorporating technological espionage, national security, and modern political maneuverings are married in this unfolding narrative. Where global software giants like TikTok could potentially become weapons in the hands of authoritarian states, the threat is heightened when these nations force their companies to clandestinely hand over sensitive data to their government.
Adding more grist to the mill, the controversial letter to Newman gives more insight into numerous meetings with official government representatives that have taken place since the cessation of negotiations. It reveals, for instance, an urgent call in March 2023 where TikTok was informed by the U.S. Treasury’s Undersecretary for Investment Security, Paul Rosen, that the security agreement’s draft was critically insufficient. According to the company, Rosen intimated that a deal could only follow ByteDance’s divestment and removal of TikTok’s source code from China’s grasp.
TikTok’s lawsuit terms such a divestment a technological hindrance, one that is impossible since it would necessitate wresting millions of lines of TikTok’s foundational code from ByteDance, effectively severing the app’s operational linkage with the Chinese counterpart.
Following media reports that ByteDance was coerced into divesting itself from TikTok under threats of a ban, allegations of problematic and damaging information leaks by government officials emerged within the legal fraternity surrounding TikTok. Several physical meetings and virtual calls on crucial aspects such as data safety measures and TikTok’s source code were also substantial parts of the saga that unfolded.
In conclusion, TikTok’s attorneys argued that CFIUS plays a crucial role in addressing government concerns as long as confidentiality imposed by law and good faith regulations are upheld. According to them, this element is compromised when negotiations are misused for legislative gains. The legal brief also brings up a sensitive document allegedly given by the Justice Department to the Congress before the latter’s move to pass a bill demanding TikTok’s sale to an approved buyer or face a ban. TikTok argues this document made allegations about its data collection without concrete evidence that such information ever fell into Chinese governmental hands.
