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China’s inclusion of new technologies on a list of export restrictions could hamper the sale of TikTok in the US, according to state media reports, in the latest surge in trade tensions between the two countries.
China’s Ministry of Commerce revealed late Friday that the government had added items, including those related to computer science and artificial intelligence, to a list of technologies subject to export controls.
In an interview with the state-run Xinhua news agency, Cui Fan, a government adviser, suggested that the new measures could affect the sale of TikTok by ByteDance, its Chinese owner, because they cover some of its underlying technologies.
He added that the company, which has attracted the interest of Microsoft, Oracle and Walmart for its operations in the United States, Canada, Australia and New Zealand, should decide “seriously and cautiously” whether to suspend its negotiations as a result.
The trade restrictions are the latest development in a dispute between China and the United States over TikTok, a popular video app that President Donald Trump has vowed to shut down unless his business in the country is sold to an American company.
China has not adjusted its list of restrictions on technology exports since 2008, the Commerce Ministry said in a statement. The changes were necessary due to the “rapid development” of science and technology in the country.
The updated list of controlled exports added restrictions for “personalized information recommendation services based on data analysis”. The Tiktok app relies on algorithms that analyze user behavior to drive personalized content.
The Commerce Ministry said it approves or rejects export requests within 30 business days of receiving the request.
Professor Cui, who is also a professor at Beijing University of Economics and International Business, told the FT that the changes had been under discussion since 2018. But China was now introducing them in part because of the “current international situation.”
Inclusion on the list means that companies must obtain additional government approvals for the export of certain technologies. Professor Cui told Xinhua that ByteDance should go through “licensing procedures” if it is exporting related technology.
TikTok scrutiny follows a broader deterioration in US-China relations, with long-standing tensions over trade intensifying this year following the coronavirus outbreak and the introduction of a new security law in Hong Kong which prompted US sanctions.
Recent US pressure has focused on the tech sector. Trump, who has hardened his stance toward China ahead of the US elections in November, has said there is “credible evidence” that the actions taken by ByteDance could harm the security of the United States.
In early August, Trump said he was giving US companies 45 days to stop dealing with WeChat, a Chinese messaging app owned by Tencent. The US president has signaled that he could take a similar approach toward other Chinese companies, including the e-commerce group Alibaba.
In China, ByteDance has faced backlash over the perception that it was giving in to American pressure.
Last week, Kevin Mayer, CEO of TikTok, resigned from his position, pointing to a “drastically changed” political environment. Earlier in the week, the company sued the Trump administration.
ByteDance did not immediately respond to a request for comment.
