The United States government should get a “substantial portion” of the sale price of the US operations of popular short-video app TikTok, US President Donald Trump said, and warned he will ban the service in the country on September 15 without a sale.
The turnaround came after Trump said last week he was planning to ban the Chinese-owned video app’s US operations as soon as Saturday after initially dismissing a possible sale to Microsoft.
Reuters news agency reported last week that some investors are valuing TikTok at about $50bn, citing people familiar with the matter.
“I did say that if you buy it, whatever the price is that goes to whoever owns it, because I guess it’s China essentially … I said a very substantial portion of that price is going to have to come into the Treasury of the United States because we’re making it possible for this deal to happen,” Trump said on Monday.
Trump later defended his push for a cut, adding: “Nobody else would be thinking about but me, but that’s the way I think.”
Nicholas Klein, a lawyer at DLA Piper, said that generally “the [US] government doesn’t have the authority to take a cut of a private deal” through the Committee on Foreign Investment in the United States (CFIUS), the interagency committee that reviews some foreign investments in the US.
It was not clear how the US government would receive part of the purchase price.
Klein added it “will close down on September 15 unless Microsoft or somebody else is able to buy it and work out a deal, an appropriate deal, so the Treasury … of the United States gets a lot of money.”
China reacted angrily to Trump’s attempt to get a US company to acquire the TikTok. The state-run China Daily newspaper said on Tuesday that China would not accept the “theft” of a technology company and is able to respond.
The US’s “bullying” of Chinese tech companies was a consequence of Washington’s zero-sum vision of “American first” and left China no choice but “submission or mortal combat in the tech realm”, the paper said in an editorial.
China had “plenty of ways to respond if the administration carries out its planned smash and grab”, it added.
TikTok said Monday it was “committed to continuing to bring joy to families and meaningful careers to those who create on our platform as we build TikTok for the long term. TikTok will be here for many years to come.”