Trump on Monday set September 15 as the deadline for TikTok to find a US buyer, failing which he said he will shut down the app in the country. In an unusual declaration, Trump also said any deal would have to include a “substantial amount of money” coming to the US Treasury.
“Right now they don’t have any rights unless we give it to them. So if we’re going to give them the rights, then … it has to come into this country,” Trump said. “It’s a great asset, but it’s not a great asset in the United States unless they have approval in the United States.”
“Whether it’s Microsoft or somebody else, or if it’s the Chinese — what the price is, the United States could — should get a very large percentage of that price. Because we’re making it possible,” he said.
Trump described his proposal as being similar to a lease between a landlord and a tenant, adding that TikTok owes the US for its success.
“TikTok is a tremendous success, but a big portion of it’s in this country,” he said.
The President’s requirement that some of the money from the deal go to the US Treasury doesn’t have a basis in antitrust law, according to Gene Kimmelman, a former chief counsel for the US Department of Justice’s Antitrust Division and currently a senior adviser to the policy group Public Knowledge.
“This is quite unusual, this is out of the norm,” Kimmelman said. “It’s actually quite hard to understand what the president is actually talking about here. … It’s not unheard of for transactions to have broader geopolitical implications between countries, but it’s quite remarkable to think about some kind of money being on the table in connection with a transaction.”
TikTok said it remains committed to its large American user base.
“TikTok is loved by 100 million Americans because it is a home for entertainment, self-expression, and connection,” company spokesperson Josh Gartner said in a statement. “TikTok will be here for many years to come.”
“[Microsoft] is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States, including the United States Treasury,” the company said, adding that it will “move quickly” to talk with ByteDance “in a matter of weeks.”
Microsoft declined to comment beyond the blog post following Trump’s remarks on Monday.
“This is a purchase that wouldn’t be necessary but for the Trump administration’s hostility to Chinese ownership of any tech companies,” said Mark Lemley, director of Stanford University’s program in law, science and technology, adding that there isn’t “much real evidence” that the app’s Chinese ownership presents a security threat.
“Instead, I think this is part of the splintering of the Internet into competing national networks,” Lemley said. “I think that’s a problem, and splitting TikTok into different national entities … is only going to make that problem worse.”
White House trade adviser Peter Navarro expressed concern about a potential Microsoft acquisition because of the company’s links to China, citing the availability of Microsoft services in the country including its Bing search engine and Skype video calling platform.
Besides selling TikTok to a US buyer, ByteDance may also be considering other moves to further insulate itself from the US-China fight.
“In light of the current situation, ByteDance has been evaluating the possibility of establishing TikTok’s headquarters outside of the US, to better serve our global users,” the company said.
CNN Business’ Hadas Gold contributed to this report.