President Donald J. Trump issued two separate Executive Orders (see here and here) to "address the threat" created by the U.S. operations of two social media mobile applications, TikTok and WeChat, both owned by companies based in the People's Republic of China. The President stated that action was required to deal with a national emergency related to "the information and communication services supply chain." He described TikTok and WeChat as applications that capture "vast swaths of information" from their users, including those in the United States. In addition, OFAC designated Hong Kong Chief Executive Carrie Lam, among other officials, to its Specially Designated Nationals and Blocked Persons List.
TikTok. According to the Order, TikTok has been downloaded over 175 million times in the United States, and tracks users' location data, search and browsing history, and other information. The information could allow China to "track the locations of Federal employees and contractors, build dossiers of personal information for blackmail, and conduct corporate espionage." An additional concern is that TikTok reportedly censors information deemed politically sensitive by the Chinese Communist Party ("CCP"), including content related to protests in Hong Kong and China's handling of its Uyghur and other Muslim minority communities.
WeChat. According to this Order, WeChat captures personal information for use by the CCP - including the tracking of Chinese nationals visiting the United States.
The Executive Orders authorize the Secretary of Commerce, beginning on September 20, 2020, to identify prohibited transactions with ByteDance Ltd., the owner of TikTok, and Tencent Holdings Ltd., the owner of WeChat. The Secretary of Commerce is authorized to prohibit such transactions - but an affirmative action on the part of the Secretary or his designee is required in order to give effect to the authorization. The WeChat Executive Order only authorizes the prohibition of transactions "related to WeChat"; it does not extend to transactions related to Tencent Holdings Ltd.'s myriad other ventures.
OFAC designated Hong Kong Chief Executive Carrie Lam, among other officials, to its Specially Designated Nationals and Blocked Persons List ("SDN List"). Under a recent Executive Order, President Trump authorized sanctions on persons involved in (i) the implementation of China's recent security law affecting Hong Kong and (ii) related human rights abuses in the territory (see previous coverage). As a result of the designations, U.S. persons generally are prohibited from engaging in transactions with Lam and the other targeted individuals. Transactions transiting through the U.S. financial system also are prohibited.
President Trump's threatened Executive Order "banning" social media application TikTok prompted Microsoft to announce that it would "continue discussions to explore a purchase of TikTok in the United States."
President Trump authorized sanctions on persons involved in the implementation of China's national security law affecting Hong Kong and in related human rights abuses.
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