White House economic adviser Larry Kudlow told CNBC on Wednesday that President Donald Trump wants to prevent China from collecting some form of payment in a deal to sell TikTok.
“I think he probably wants to deny China some of the proceeds from the TikTok sale. It’s not something that was done in the past, but that does not mean it can not be done now,” the director said. the National Economic Council said on “Closing Bell.”
Trump has moved to ban the US’s popular social media app, arguing it poses a national security risk. He on Friday signed an executive order mostly saying that its owner, the Chinese tech company ByteDance, should sell or spin its American TikTok company within 90 days.
A few companies have apparently looked at taking over TikTok’s US operations, including Microsoft and enterprise software giant Oracle, in response to Trump’s actions in recent weeks. In addition to the US company, it is said that a potential deal is likely to cover TikTok’s operations in Canada, Australia and New Zealand.
The president has suggested that the U.S. government should receive a portion of each transaction involving the sale of TikTok’s U.S. operations, a deal that could be worth as much as $ 30 billion. But it remains unclear how, exactly, the government would collect a portion of the sale as if it was even allowed under the law.
ByteDance is also a privately owned company. Roughly 70% of ByteDance’s outside investors are from the US, Reuters reported.
TikTok has denied claims that it poses a national security risk to US-based users. In an interview aired on NBC’s TODAY on Wednesday, the general manager of TikTok US again shrugged off the accusations.
“We have very strict data controls in place, we have a great team that builds world-class infrastructure,” said Vanessa Pappas.
ByteDance did not immediately respond to a request from CNBC for comment on Kudlow’s comments.
Kudlow said he “did not know” whether the U.S. Treasury would eventually receive some form of payment. But he acknowledged that it was “unusual”.
“The president has his own thoughts on some of these things… Nothing is sitting here in cement. We have not even had all the bids, and goods that go along with it. That is not to be expected until mid-September,” he said. “I do not know how that will play out. It may turn out to be, or fees may appear to be out.”
Announcement: Larry Kudlow is a former CNBC contributor.
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