Commentary on Political Economy

Friday 18 September 2020



U.S. Curbs WeChat Transfers, Freezes TikTok as Deadline Looms

The U.S. will ban some transactions over the Chinese-owned WeChat app while freezing TikTok’s app starting Sunday, Commerce Secretary Wilbur Ross said.

Ross said Friday that the U.S. will prohibit U.S.-to-U.S. transactions related to WeChat and its parent company Tencent Holdings Ltd. but that will not impact activity in China. Transactions prohibited as of Sept. 20 including distribution, maintenance and updates of WeChat or TikTok through app store in the U.S.

The Commerce Department in a release Friday said the president has provided until Nov. 12 for national security concerns posed by ByteDance Ltd.’s TikTok to be resolved. If they are, the prohibitions in this order may be lifted.

In August, President Donald Trump issued executive orders prohibiting U.S. residents and firms from doing business with Tencent’s WeChat and ByteDance’s TikTok.

ByteDance has been negotiating with Oracle Corp. to take a stake in a reconfigured TikTok to alleviate the president’s concerns about data on the app’s American users being exposed to China.

“WeChat U.S., for all practical purposes, will be shut down,” Ross said on Fox Business. Americans will still be able to use WeChat for payments in China, he said. “The basic Tiktok will stay intact until November 12,” although users won’t be able access upgrades from Sunday night, he said.

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