ByteDance seek China’s approval for TikTok deal with Oracle, Walmart

ByteDance has applied for a tech export license in China as it races to secure a deal with Oracle and Walmart to avoid the ban of its popular video sharing app, TikTok in the US. 

For months, ByteDance and its app TikTok has been at the center of a political scandal as the US-China relations continue to deteriorate over issues like the pandemic and trade.

The Beijing-based, ByteDance has submitted the request to the municipal commerce office of China and is awaiting a decision, it said in a statement without referring to ongoing talks about its US operations.

The request comes around a month after China, for the first time in 12 years, updated its list of technologies subject to export bans or restrictions, in a way that experts said gave the Chinese government a control over any TikTok deal.

ByteDance said its agreement with Oracle and Walmart will see the formation of a separate US business and does not require any technology transfer, while Oracle will be able to inspect the source code of TikTok US. It has also said that the deal will require approval from both China and the United States.

Meanwhile, the companies have made contradictory remarks regarding the terms of agreement casting doubt about whether it would hold.

ByteDance said it is going to set up subsidiary called TikTok Global in US, 80% of which it will own after the deal. However, Oracle and Walmart said TikTok Global’s majority ownership will be in American hands, consistent with the US executive order issued on August 14 where President Donald Trump ordered ByteDance to relinquish TikTok ownership within 90 days.

This week, the Chinese state media outlets like China Daily and the Global Times said they see no purpose for China to accept the agreement that Oracle and Walmart said they struck with ByteDance, calling it a deal based on “bullying and extortion.” Earlier reports had suggested that China preferred for TikTok to shutdown in the US rather than undergo a forced sale as it shows the country and the company in a ‘weaker position.’

It was very recently that ByteDance struck a deal with Walmart and Oracle that would help it to survive in the US, where the video sharing app is wildly popular especially among teenagers.