(Reuters) – A U.S. federal appeals court ruled on Friday in favor of upholding a law requiring China-based ByteDance to divest its popular short video app TikTok in the United States by early next year or face a ban.
Here is what will likely happen next for TikTok.
WHAT’S NEXT FOR TIKTOK IN COURT?
TikTok and its parent ByteDance sued in federal court to block a U.S. law passed in April that would force ByteDance to divest of TikTok. It argued that the law would harm free speech.
On Friday, a three-judge panel of the U.S. Court of Appeals for the District of Columbia ruled in favor of the government, citing national security considerations related to China.
The ruling could be appealed to the Supreme Court before the ban takes effect on Jan. 19.
Last year, TikTok took similar legal actions to stop a ban on the app in the state of Montana, where a preliminary injunction was granted.
HOW DID THIS START AND HOW LONG WILL THIS ALL TAKE?
In August 2020, then-President Donald Trump sought to ban both TikTok and Chinese-owned WeChat, but was blocked by courts. In June 2021, President Joe Biden withdrew a series of Trump-era executive orders that sought to ban new downloads of WeChat and TikTok.
However, legislators later advanced a bill that compelled ByteDance to divest or face a ban. It passed with wide margins in both the U.S. House of Representatives and the U.S. Senate.
To be considered a qualified divestiture, the president must determine TikTok is no longer controlled by and would have no operational relationship with a Chinese entity.
When Biden signed the bill in April, a 270-day clock started.
If Biden certifies a path to a qualified divestiture has been identified, there is evidence of “significant” progress toward a sale and there are legally binding agreements in place, he can authorize an additional 90 days for any deal to be finalized.
The additional time would throw the final decision to President-elect Trump, who has said he will not allow TikTok, which is used by 170 million Americans, to be banned. At least one senator has noted that Trump cannot ignore the TikTok law.
U.S. tech companies could face billions of dollars in fines if they allowed users to access TikTok after Jan. 19 and even if Trump said he would not enforce the law, they could face potential risks from others who might seek to enforce it.
WILL TIKTOK CHANGE AT ALL?
The TikTok app should not change for its U.S. users between now and Jan. 19.
WHAT DOES THE CHINESE GOVERNMENT SAY?
China has a list of technologies that would need Chinese government approval before they are exported. Experts said TikTok’s recommendation algorithm would fall under the list, making divestment very difficult for ByteDance.
(Reporting by Chris Sanders; additional reporting by David Shepardson; Editing by Jonathan Oatis)
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