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Trump says US should get a cut from TikTok sale

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"I said a very substantial portion of that price is going to have to come into the Treasury of the United States because we're making it possible for this deal to happen"
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US President Donald Trump said yesterday the US government should get a “substantial portion” of the sales price of the US operations of popular short-video app TikTok and warned he will ban the service in the United States on September 15 without a sale.

“I did say that if you buy it, whatever the price is that goes to whoever owns it, because I guess it’s China essentially ...­ I said a very substantial portion of that price is going to have to come into the Treasury of the United States because we’re making it possible for this deal to happen,” Trump said.

He later defended his push for a cut, adding “nobody else would be thinking about but me, but that’s the way I think.”

Microsoft is in talks to buy TikTok, which has as many as 1 billion worldwide users. Reuters reported last week that some investors are valuing TikTok at about US$50 billion, citing people familiar with the matter.

US officials have said TikTok poses a national risk because of the personal data it handles — an accusation the company has repeatedly denied.

Trump, a former New York real estate developer, compared TikTok to the landlord-tenant relationship, suggesting TikTok is like a tenant. “Without a lease, the tenant has nothing — so they pay what’s called key money or they pay something.”

He said he did not mind “whether it’s Microsoft or somebody else ­— a big company, a secure company, very, very American company buy it.”

Nicholas Klein, a lawyer at DLA Piper, said generally “the government doesn’t have the authority to take a cut of a private deal through” the Committee on Foreign Investment in the United States, which is the interagency committee that reviews some foreign investments in the United States.

It was not clear how the US government would receive part of the purchase price.

Trump added it “will close down on September 15 unless Microsoft or somebody else is able to buy it and work out a deal, an appropriate deal so the Treasury ... of the United States gets a lot of money.”

China slammed the latest move as “political manipulation.”

“This goes against the principles of the market economy and the World Trade Organization’s principles of openness, transparency and non-discrimination,” said foreign ministry spokesman Wang Wenbin. “It’s outright bullying.”

He said the national security grounds for the US’s clampdown on Chinese firms “does not hold water,” adding that the companies conduct their business activities in accordance with international rules and US laws. “But the US is cracking down on them on trumped-up charges,” said Wang, who warned the US not to “open Pandora’s box.”

The pressure for a sale of its US and international business, based in Los Angeles, has left the company and its Chinese parent ByteDance facing tough decisions.

ByteDance founder Zhang Yiming told employees yesterday there were misunderstandings on Chinese social media about TikTok’s situation and that the company could face more difficulties as anti-Chinese sentiment rose abroad.

His comments in a letter to ByteDance’s Chinese employees came after the company and Zhang were criticized on Chinese social media because some believed ByteDance had given in too quickly to Washington.

Zhang said Washington’s goal was not to force a sale of TikTok’s US operations through CFIUS but to ban the app, and there was a legal process ByteDance had no choice but to follow.

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