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A bipartisan group of U.S. lawmakers on Tuesday introduced legislation to give China’s ByteDance about six months to divest itself of the popular short video app Tik Tok or face a U.S. ban, seeking to address national security concerns about its Chinese ownership.
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Canadian investor Kevin O’Leary is still interested in a deal with TikTok, but it’s not possible under current law, he told CNBC, as President Donald Trump extended the deadline to ban the social media platform.
As part of a wave of executive orders after his inauguration on Monday, Trump delayed the imposition of a law for 75 days that would effectively ban TikTok, allowing its administration “an opportunity to determine the appropriate course of action.”
Trump had promised the measure in a social media post On Sunday, he also floated a deal that would see the platform remain active in the U.S. under a 50% U.S.-owned joint venture.
“I would love to work with Trump on that 50/50 deal, as would any other potential buyer… But the problem with some of these ideas is that they are inconsistent with the Supreme Court ruling,” the investor said. Widely known for his role on ABC’s “Shark Tank.”
O’Leary announced that he, along with “The people’s commitment to TikTok,“an effort led by Project Liberty founder Frank McCourt had offered ByteDance $20 billion in cash to buy TikTok in an appearance on Fox News’ “America’s Newsroom.”
Speaking to CNBC, he said the proposed deal did not include ByteDance’s TikTok algorithm, which has been a key point of scrutiny by US lawmakers, adding that his group had an alternative algorithm.
ByteDance had not announced any deal before Sunday’s deadline to divest TikTok after the Supreme Court. sustained he Controlled Requests Act to Protect Americans from Foreign Adversariesor PAFACA, which applies to TikTok.
McCourt confirmed to CNBC that the Project Liberty team remained “ready to work collaboratively with the Trump Administration, ByteDance and a consortium of US partners to finalize this critical deal.”
“Project Liberty has proven technology already in use and offers a clear path to address Congress’s national security concerns while keeping TikTok operational,” he added.
Legal obstacles
Companies involved with TikTok have had different reactions to Trump’s executive order. Service providers like Oracle and Akamai have voluntarily kept TikTok online, while Apple and Google have yet to restore ByteDance-owned apps to their stores.
According to O’Leary, while Trump’s extension of the ban has likely provided protection to companies like Oracle and Akamai, it is unclear whether ByteDance’s deadline to divest will be extended.
“What we need is not really a 75-day extension. What we need is to go back and ask Congress to open up the order and provide for these new options, because they are not provided at this time,” he said.
“I would love to reach an agreement, if the law allows it, but I cannot afford to violate the order of Congress,” he added.
Legal experts who spoke to CNBC agreed that the legal status of TikTok and Trump’s executive order remained uncertain and that any effort to reach a deal with TikTok could face challenges.
“The Order does not appear to comply with the statute. Congress carefully included certain dates and procedures in the law, which SCOTUS found constitutional,” said Carl Tobias, a law professor at the University of Richmond.
“Therefore, a federal court could find the order violates the law and invalidate it,” he said, adding however that such action could take a long time if the government were to appeal to SCOTUS.
Yesarah Kreps, director of the Technology Policy Institute at Cornell University, agreed that the executive order was not consistent with the Supreme Court’s decision, adding that it said nothing about progress toward qualified divestment.
Given that violators of the TikTok law could face billions in fines, it is not entirely prudent for the parties to accept Trump’s assurances about the law and the SCOTUS ruling, Kreps said.
“They are certainly playing with the law and putting a lot of faith in executive authority,” he added.
China softens its stance
O’Leary told CNBC that TikTok could reach between 20 and 30 billion dollars on the market in March last year, a huge discount, given that any sale would likely exclude the platform’s algorithms.
Instead, the value of a potential deal was the opportunity to gain TikTok’s strong national brand and its more than 100 million userssaid.
Still, as talk of selling TikTok intensified, Beijing was seen as a major barrier to a divestment from BytdeDance.
On Monday, Beijing showed its openness to a deal that would allow American companies to take ownership of the platform.
“When it comes to actions such as the operation and acquisition of companies, we believe they should be decided independently by companies in accordance with market principles,” a Beijing spokesperson said on Monday when asked about President Donald Trump’s proposal. .
According to O’Leary, any potential sale of ByteDance is still expected to be negotiated between Trump and Chinese President Xi Jinping.
“With TikTok, I have the right to sell it or shut it down, and we will make that determination and we may have to get approval from China as well,” Trump told reporters after his inauguration.
In signing the executive order, the President allegedly suggested that he could impose tariffs on China if Beijing does not approve a US deal with TikTok. On Tuesday he said he would consider the likelihood of tesla executive director Elon Musk o President of Oracle Larry Ellison Buy TikTok.
Meanwhile, O’Leary told CNBC that he was in Washington still working on a potential TikTok deal with US lawmakers.
