Home Money & Business Business Trump’s executive action grants TikTok a stay of execution. What are the next steps?

Trump’s executive action grants TikTok a stay of execution. What are the next steps?

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Trump’s executive action grants TikTok a stay of execution. What are the next steps?

President Donald Trump has ordered the Justice Department to suspend the enforcement of the TikTok ban until early April. This decision raises significant questions, particularly about Trump’s authority to issue such a directive and whether TikTok’s parent company, ByteDance, would consider divesting from the popular app.

In an executive order signed on a Monday, Trump instructed the U.S. attorney general to refrain from enforcing the ban for 75 days. This pause is intended to provide the administration time to determine a suitable approach that safeguards national security while avoiding an immediate shutdown of TikTok.

A federal law, which was recently upheld by the Supreme Court, mandated that ByteDance must sell the app to an approved buyer by a specified deadline or face a comprehensive ban across the nation. On the eve of the deadline, TikTok was rendered inoperable for U.S. users; however, it was restored shortly after, with TikTok attributing the return to Trump’s intervention, who had previously pledged on social media to pause the ban.

The bipartisan federal law that passed last year includes a provision allowing for a 90-day extension if tangible progress is observed toward a potential sale. However, the new executive order introduces complexities for companies that may have responsibilities in providing TikTok’s service to U.S. users.

As of now, companies like Apple and Google, which oversee the leading app stores, have not offered TikTok or any other applications associated with ByteDance, such as Lemon8 and CapCut, on their platforms.

The central question remains: Can Trump legally halt the TikTok ban? Although the Justice Department is generally responsible for upholding federal law, Trump’s authority does not extend to overruling a law enacted and validated by Congress and the Supreme Court.

While the law does permit the president some discretion regarding specifics—like defining what constitutes a “qualified divestiture” of TikTok—the stipulation that an extension is contingent upon demonstrating “significant progress” toward its sale means that Trump’s order could be subjected to legal scrutiny.

On Tuesday, the Electronic Frontier Foundation, a group advocating for digital rights, expressed concerns, stating that ignoring the law would be “unconstitutional.” David Greene, the organization’s Civil Liberties Director, emphasized that there would be no winners unless Congress repeals the law.

Meanwhile, Senator Tom Cotton from Arkansas listed potential parties in a post on X that could challenge the order, yet there remains uncertainty regarding whether a legal challenge will proceed. The executive order itself warns potential challengers that enforcing the law could encroach upon the powers of the executive branch due to the critical national security concerns involved.

Regarding the potential sale of TikTok, even if an extension faces legal challenges, it offers ByteDance and TikTok the opportunity to strategize their next steps. Trump expressed a desire for the U.S. government to facilitate a deal that would secure a 50% stake in TikTok. He indicated that a multitude of wealthy individuals have shown interest in acquiring the platform.

Trump’s proposed terms included a 50% stake in a joint venture between the U.S. and the chosen buyer, although specifics about whether this would grant governmental control over the app remain vague. Notably, around 60% of privately-held ByteDance is owned by global investors, while the company’s employees and founder hold significant stakes as well.

Despite the potential for an American company to gain a 50% stake in TikTok, how a transaction brokered by Trump could resolve the national security issues that prompted calls for divestment remains uncertain. Notably, Trump has not clarified whether he would permit ByteDance to retain control over the app’s critical algorithm, which continues to be a major concern for law proponents.

Looking ahead, negotiations regarding TikTok’s future are likely to unfold. Previously, the Chinese government criticized the U.S. push for divestment, but recent comments from the Chinese Foreign Ministry suggest a possible shift. The ministry’s spokesperson indicated that business actions and acquisitions should be determined under market principles while complying with Chinese laws.

Trump has warned he might impose tariffs of up to 100% on Chinese goods should Beijing obstruct a TikTok sale, categorizing such a move as a “hostile act.” Following the statute’s enactment last year, ByteDance had indicated no intent to sell TikTok and engaged in prolonged legal battles over the issue. As of Tuesday, representatives for ByteDance and TikTok had not made any statements regarding their willingness to sever ties within the new 75-day extension period.

Industry analysts suggest that if negotiations proceed smoothly, it could lead to China permitting the export of TikTok’s algorithm, though a sale that excludes the technology might present fewer legal and technical barriers. This situation is likened to a high-stakes poker game, with TikTok positioned as a significant component in broader U.S.-China negotiations.

When asked on Tuesday if he had installed TikTok on his device—the app being banned from federal devices over security concerns—Trump responded, “No, but I think I might put it there,” recognizing the platform’s value in engaging younger voters during the previous election cycle. During his earlier term, he had pursued a ban, citing national security threats associated with the app.