US Govt. Reviewing TikTok’s $1B Musical.ly Acquisition

The United States government is investigating China-based ByteDance Technology, the company that owns popular video app TikTok, according to Reuters.

The investigation is mainly centered around the company’s acquisition of social media app Musical.ly two years ago.

U.S. lawmakers have been calling for an investigation into the company for some time, and their concerns include other issues, such as whether ByteDance is censoring political content it doesn’t like, or what it does with its data.

The app is wildly popular with American teenagers, and about 60 percent of the app’s 26.5 million active monthly users are between the ages of 16 and 24.

The investigation is going to be led by the Committee on Foreign Investment in the United States (CFIUS), which has the authority to look into deals by foreign companies that have potential security risks. ByteDance didn’t seek CFIUS approval when it acquired Musical.ly, which means that it can be investigated now.

CFIUS is reportedly talking to TikTok about how to avoid having to divest its Musical.ly assets.

“While we cannot comment on ongoing regulatory processes, TikTok has made clear that we have no higher priority than earning the trust of users and regulators in the U.S.,” a TikTok spokesperson said. “Part of that effort includes working with Congress, and we are committed to doing so.”

A spokeswoman for the U.S. treasury department, which chairs CFIUS, said the Treasury “does not comment on information relating to specific CFIUS cases, including whether or not certain parties have filed notices for review.”

“By law, information filed with CFIUS may not be disclosed by CFIUS to the public,” she added.

Two prominent lawmakers, Sen. Tom Cotton and U.S. Senate Minority Leader Chuck Schumer, asked for a probe into the company last week. They said they were worried about data collection practices and whether China censors content seen in the U.S.

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