by BEIJING (AP) — US lawmakers have questioned TikTok CEO Shou Zi Chew about data security and harmful content, with some pushing to ban the popular short-video app nationwide.
Chew, originally from Singapore, told lawmakers that TikTok prioritizes user safety as he sought to avoid a US ban on the app by downplaying its ties to China.
House Republicans and Democrats alike aggressively challenged Chew on issues including TikTok’s content moderation practices, its data security plans and past spying on journalists.
Here’s a look at some of the concerns about TikTok and its ownership.
WHY DOES WASHINGTON SAY TIKTOK IS A THREAT?
TikTok, which has more than 150 million US users, is a wholly owned subsidiary of Chinese technology company ByteDance Ltd., which appoints its executives.
ByteDance is based in Beijing but is registered in the Cayman Islands, as is common for privately owned Chinese companies. Its headquarters are in the Haidian district of northwest Beijing, home to key universities and a hub for tech startups. TikTok has two headquarters in Singapore and Los Angeles.
Founded by Chinese entrepreneur Zhang Yiming in 2012, ByteDance is said to be valued at around $220 billion, nearly half of its $400 billion valuation in 2021. Chinese publicly-traded tech companies and private ones like ByteDance have lost value since the ruling Communist Party tightened control over the industry with crackdowns on antitrust and data security.
Western governments fear Chinese authorities could force ByteDance to hand over TikTok data on American users, exposing sensitive information. Foreign Ministry spokeswoman Mao Ning said Friday that China’s government has never asked and will never ask companies to “collect or provide data, information or intelligence” in foreign countries, adding that the U.S. national security. “
ByteDance says its shares are 60% owned by non-Chinese investors, including US investment firms Carlyle Group and Kohlberg Kravis Roberts and Japan’s SoftBank Group. The employees own 20% and their founders the remaining 20%.
Some details of the relationship between TikTok and ByteDance remain unclear to outsiders.
WHAT CHINESE STANDARDS ARE WESTERN GOVERNMENTS CONCERNED?
China’s 2017 National Intelligence Law states that “any organization” must assist or cooperate with state intelligence work, while a 2014 Counter-Intelligence Law says that “relevant organizations…cannot refuse” to collect evidence. for an investigation.
Since ByteDance, which owns TikTok, is a Chinese company, you may have to comply with these rules if you are asked to hand over data by Chinese authorities.
Laws and regulations are only one aspect of the general control of the Communist Party. There are no legal limits to the party’s powers. Authorities can also threaten to cancel licences, conduct regulatory or tax investigations, and use other sanctions to force Chinese and foreign companies to comply with their operations in China.
The party sometimes transmits commands using “window guidance” or informal communication in private. He has used strong measures to tighten control over technology companies and force them to align with his goals.
The Chinese government has also sought more direct control over companies by gaining seats on boards of directors.
SHOULD TIKTOK GIVE UP THE DATA IF THE CHINESE GOVERNMENT SAYS SO, EVEN WITH THE TEXAS PROJECT?
TikTok has promised to protect the data of US users by storing it on servers operated by a third-party contractor, Oracle Corp., in what is known as “Project Texas.” Chew, the CEO of TikTok, said that all new US user data is stored in the United States and the company should finish removing older US data from non-Oracle servers this year.
The fear is that ByteDance will have to hand over information it obtained from TikTok if ordered to do so by Chinese authorities, but Chew has said Project Texas will put US data out of China’s hands.
ByteDance disclosed in December that four employees gained access to data about reporters and people connected to them while looking into how information about the company was leaked. Chew told lawmakers that China-based ByteDance employees may still have access to some US data, but that won’t be the case once the Texas Project is complete.
In November, TikTok’s head of privacy for Europe said some employees in China had access to information about users in Britain and the European Union.
DOES THE COMMUNIST PARTY HAVE ANY INFLUENCE ON BYTEDANCE?
At Thursday’s hearing, lawmakers repeatedly tried to pin down Chew on whether ByteDance had ties to China’s communist rulers.
He dodged questions about whether the staff and top executives are members of the Communist Party.
“I know the founder himself is not a member of the Communist Party, but we don’t know the political affiliation of our employees because that’s not something we ask,” Chew said.
When asked if ByteDance was indeed controlled by the Chinese Communist Party, Chew said he disagreed.
After a lawmaker said the Communist Party has a “golden share” in ByteDance that allows it to control a ByteDance board seat, Chew said, “That’s not correct.”
In China, so-called golden shares held by official investment funds are a way for Beijing to gain greater oversight of businesses by giving them a 1% stake in companies.
Chew pushed back when lawmakers claimed the Communist Party owns shares in ByteDance that give it a vote on how the company is run. “The Communist Party does not have the right to vote in ByteDance,” Chew said.
ByteDance’s main Chinese subsidiary is the licensee of some of its video and information platforms that only serve the Chinese market.
WHAT IS DOUYIN AND WHAT IS TIKTOK’S RELATIONSHIP WITH IT?
Douyin is ByteDance’s short video platform for the Chinese market. It’s similar to TikTok, but its content is restricted by Chinese censorship rules that ban material deemed subversive or pornographic, a point emphasized by US lawmakers concerned about harmful content viewed by young people.
The Communist Party’s extensive internet filters prevent most users in China from viewing TikTok. ByteDance has said that TikTok has “no affiliation” with Beijing ByteDance Technology Co., the subsidiary that operates Douyin; Toutiao, short video and news platform, and other services.
HOW DID CHINA REACT TO THE TESTIMONY OF THE CEO OF TIKTOK IN WASHINGTON?
Most of the social media reaction in China was sympathetic to Chew, with praise for how he handled hostile questions thrown at him.
Comments on Douyin and microblogging platform Weibo criticized US lawmakers for asking Chew misleading or misleading questions. Many commenters used a Chinese saying that means “If you want to accuse someone, there is always a way.”
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Associated Press Business writer Kelvin Chan in London contributed to this report.
