TikTok national security inquiry is the latest US show of force on Chinese access to American data

  • The U.S. is investigating TikTok’s Chinese parent, Bytedance, over national security concerns.
  • Regulators may be concerned about risks posed by the data that TikTok collects.
  • The security review casts one more spotlight on the potential dangers of digital data at a time when U.S. regulators are looking into risks posed by the nation’s own social media giants.

TikTok lets its millions of users record 15-second clips to trendy tunes. It has caught on with theatrical millennials and helped turn Lil Nas’ “Old Town Road” into a smash. Now, according to the U.S. government, it may be a national security risk.

The Committee on Foreign Investment in the United States, or CFIUS, has contacted TikTok’s Chinese parent, Bytedance, over concerns that its acquisition of social media app Musical.ly poses a national security risk, a person familiar with the situation told CNBC. The inquiry, first reported last week by Reuters, stems in part from the dangers the committee perceives from the Chinese government’s access to the app’s data and user profiles, the person said.

CFIUS reached out to Bytedance after a number of U.S. lawmakers, including Sen. Marco Rubio, R-Fla., Senate Minority Leader Chuck Schumer, D-N.Y., and Sen. Tom Cotton, R-Ark., publicly called for an inquiry into the company, the person familiar with the situation said.

The inquiry, which has not yet turned into a full investigation, is a sign of CFIUS’ increased focus on the vulnerabilities that data affords, amid rising geopolitical tension and a growing focus on Big Tech.

“When this deal closed two years ago — in November 2017 — there wasn’t any real indication that CFIUS was going to care about something like this,” said Scott Flicker, chairman of the Washington office at law firm Paul Hastings.

Since then, CFIUS has put an emphasis on the potential national security risks involving data. more

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