New export rule for technology: China makes it difficult to sell Tiktok to the USA

Without a sale, the popular Tiktok app is threatened with extinction in the USA in September. Microsoft is already negotiating with the Chinese company Bytedance. However, a new directive from China's government is likely to complicate an agreement.

The talks forced by the White House to sell the US business of the popular video app Tiktok could be hampered by export restrictions imposed by the Chinese government. According to the new rules, among other things, "IT technologies with personalization based on data analysis" and operation using artificial intelligence may only be sold abroad with a permit from the government. Tiktok belongs to the Chinese company Bytedance.

The Chinese Ministry of Commerce published the new rules on Friday. On Saturday, the official Chinese news agency published an interview with a university professor who pointed out that the technologies at Tiktok fell under this description. In order for the international business to continue functioning, algorithms and software from Bytedance would have to pass to a new owner. The list of products affected by export restrictions has been expanded to include 23 items.

US President Donald Trump describes Tiktok as a security risk because Chinese authorities could gain access to American data via the app. At the beginning of August he banned US companies and citizens from doing business with Tiktok – the ban is due to take effect in mid-September. Without a sale, Tiktok threatens to end in the USA. Tiktok and Bytedance deny the allegation and went to court in the US.

The software giant Microsoft is currently negotiating the purchase of the Tiktok business in the USA, Canada, Australia and New Zealand. The supermarket giant Walmart also wants to be on board. At the same time, according to media reports, a group of startup investors is in the running together with the software company Oracle. Trump also ordered in mid-August that Bytedance had to disconnect from all data from users in the United States within three months. Bytedance is also no longer allowed to own any property in the USA that is used for the operation of Tiktok.