China state firms invest in TikTok sibling, Weibo chat app

The Chinese authorities has made investments successful 2 of the nation's astir important exertion firms—ByteDance, the Chinese institution that owns planetary video app TikTok, and Weibo, China's mentation of Twitter—in a determination seemingly intended to bolster its sway implicit the nation's flourishing exertion sector.

In April, ByteDance sold a 1% involvement successful its Chinese subsidiary, Beijing ByteDance Technology Co., to WangTouZhongWen (Beijing) Technology, a state-backed firm, according to nationalist authorities records and the firm accusation level Qichacha.

WangTouZhongWen is owned by 3 Chinese authorities entities, 1 of which is linked to a money backed by the Cyberspace Administration of China, the nation's net watchdog, according to authorities records and Qichacha data.

The Information, a U.S. tech site, earlier reported that Bytedance had besides fixed a committee spot to a Chinese authorities authoritative arsenic portion of the deal.

A ByteDance spokesperson declined to reply questions astir the concern and committee seat. But the institution said that its Chinese subsidiary doesn't ain TikTok, which operates extracurricular of China. Instead, the subsidiary "relates to immoderate of ByteDance's China-market video and accusation platforms, and holds immoderate of the licenses they necessitate to run nether section law."

The Chinese mentation of TikTok is called Douyin. ByteDance besides owns the Chinese quality app Toutiao.

Beijing has precocious been clamping down connected its exertion sector. It has launched investigations into immoderate of the country's largest net companies and introduced caller draught rules to fortify data security and to prohibit companies from engaging successful anti-competitive behaviour aft years of runaway maturation successful the industry.

In China, monolithic exertion firms specified arsenic Alibaba and Tencent supply services specified arsenic e-commerce, payments, gaming and societal media that are ubiquitous and utilized by hundreds of millions of Chinese people.

News of the Chinese concern renewed immoderate national-security concerns astir TikTok successful the U.S., wherever the video app has millions of users and is peculiarly fashionable with young people.

Last year, then-President Donald Trump sought to barroom TikTok and different Chinese apps and services from the U.S. President Joe Biden earlier this twelvemonth dropped Trump's effort to prohibition TikTok, but the Biden medication has said it is reviewing the nationalist information risks of Chinese apps.

Officials are acrophobic astir apps that cod users' idiosyncratic information oregon person connections to Chinese subject oregon intelligence—worries that whitethorn reflector those of Chinese officials crossed the Pacific.

A national-security reappraisal of TikTok by a authorities radical called the Committee connected Foreign Investment successful the United States, oregon CFIUS, is ongoing. CFIUS had acceptable deadlines for TikTok to divest its U.S. operations, but specified a merchantability ne'er happened.

On Tuesday, Sen. Marco Rubio of Florida called connected the White House to artifact TikTok, citing quality of the Beijing involvement and the committee seat.

"The Biden Administration tin nary longer unreal that TikTok is not beholden to the Chinese Communist Party," helium said successful a statement. "Even earlier today, it was wide that TikTok represented a superior menace to idiosyncratic privateness and U.S. nationalist security. Beijing's aggressiveness makes wide that the authorities sees TikTok arsenic an hold of the party-state, and the U.S. needs to dainty it that way. "

China's overseas ministry spokesperson Zhao Lijian said Wednesday that Rubio's comments "disregarded the facts and unremittingly made anti-China remarks" to prosecute his ain governmental interests.

TikTok has maintained that it does not store U.S. idiosyncratic information successful China, that it would not supply information connected users to the Chinese authorities and denied that it's a information threat.

Weibo, meanwhile, which trades connected the Nasdaq, said successful U.S. securities filings that an entity called WangTouTongDa (Beijing) Technology Co., Ltd., which was affiliated with ZhongWangTou (Beijing) Technology Co., Ltd, successful April 2020 invested astir 10.7 cardinal successful China's currency, the yuan, for a 1% involvement of Weibo's China subsidiary, Beijing Weimeng Technology Co., Ltd, oregon Weimeng.

Those 2 companies are besides state-backed firms, according to nationalist authorities records.

Weibo said that the stakeholder had the close to name a manager to Weimeng's three-member committee and veto rights implicit "certain matters related to contented decision" and financings. Weibo did not instantly respond to a petition for comment.

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