The United States Treasury’s Committee on Foreign Investment in the United States (CFIUS) is expected to issue an order compelling China-based ByteDance to divest itself of short-form video app TikTok as soon as Friday afternoon, according to multiple reports.
Sources speaking to Bloomberg and Reuters said that CFIUS will require ByteDance to sell TikTok, much like it did with Grindr last year. The CFIUS has the power to review acquisitions of U.S. companies made by foreign investors to ensure that they do not create a “national security risk.”
According to a Reuters report Wednesday, investors looking to take over TikTok valued the company at $50B USD. The New York Times, citing an anonymous source with knowledge of the deal, reports that Microsoft is in talks to buy TikTok.
It is unclear what legal measures ByteDance could take should CFIUS order it to divest itself of TikTok, but Electronic Frontier Foundation General Counsel Kurt Opsahl said in an interview published by The Esports Observer Monday that because the U.S. Treasury is part of the Executive Branch there maybe be some First Amendment relief:
“I’m not as familiar with what powers are granted to them,” Opsahl said, referring to CFIUS. “They are a part of the executive branch and so all the constitutional issues would apply regardless of what any statute said.”
The Esports Observer will have more on this story as it develops.