On the evening of August 6, local time, U.S. President Trump signed two executive orders prohibiting U.S. individuals and businesses from conducting any transactions with ByteDance, the parent company of the video sharing app TikTok, and Tencent, the parent company of the messaging app WeChat. Effective after 45 days (September 20).
In the executive order, Trump also said that any U.S. citizens and entities would be prohibited from conducting any WeChat-related transactions, or transactions with properties subject to U.S. jurisdiction, with Tencent or any of its subsidiaries.
A few days ago, U.S. Secretary of State Pompeo announced five major measures for the “Clean Network” and named seven Chinese technology companies, including Huawei, China Mobile, and Baidu, to ban more applications from China and further restrict Chinese companies have access to cloud systems in the United States. The executive order signed by the Trump administration this time takes the “clean network” plan further into action.
Trump’s newly signed executive order accuses the TikTok app of “potentially being used for disinformation campaigns” to benefit China, while the US must “take tough action” against TikTok’s owner to protect America’s “national security” “. In a separate order, Trump accused WeChat of “automatically harvesting vast amounts of information from users,” accusing the data collection that “could expose China to Americans’ personal and proprietary information.”
The executive order will effectively disable WeChat in the U.S. within 45 days, the report said, “to the extent permitted by applicable law, prohibit any person from any transaction related to WeChat, or with any property subject to U.S. jurisdiction and Tencent Holdings Ltd. trade.”
Trump administration officials this week said they were stepping up efforts to remove “untrusted” Chinese apps from U.S. digital networks, calling China’s short-video app TikTok and messaging app WeChat a “significant threat.”
The executive order signed by Trump this time not only means that after 45 days, the apps of Tencent and ByteDance will not be able to appear on Apple’s App Store or Google’s Play Store and other U.S. app stores. Businesses will also be unable to do any deals with Tencent and ByteDance. It will also force Tencent and ByteDance to dispose of their related U.S. operations and investments within 45 days, after which all transactions will be banned.
It should be pointed out that, as a global Internet and game giant Tencent, Tencent has a very wide range of investments around the world. According to the information disclosed on the official website, Tencent Investment focuses on investment in consumer Internet and industrial Internet-related fields on a global scale, including entertainment media, consumer retail, livelihood education, financial technology, corporate services and overseas investment. In the past ten years, Tencent has invested in more than 800 companies, including more than 100 listed companies and unicorns, covering more than 20 countries and regions around the world. The United States is also a country where Tencent invests more.
Especially in the game field, Tencent’s investment is huge. For example, Roit Games (holding 100%) and Epic Games (holding 40%) and Activision Blizzard (holding 5%) in the United States; Supercell in Finland (holding 84%); Ubisoft in France (holding 5%), etc. They are all well-known game companies invested or controlled by Tencent.
With the issuance of Trump’s executive order, Tencent and ByteDance’s U.S. subsidiaries or controlled U.S. companies may also be affected after 45 days. Then these companies may need to draw a clear line with Tencent if they want to continue to survive, which also means that Trump’s move may be like dealing with ByteDance’s Tiktok, forcing Tencent and ByteDance to lower prices within 45 days in disguise Dispose of its U.S. investments and withdraw from the U.S. market entirely. This is clearly robbery.
Previously, after Trump set a deadline (September 15) for Microsoft to acquire TikTok’s US business and other places. Trump also said this week that the U.S. government would “take a cut” of the deal and would support the sale of TikTok’s U.S. operations to Microsoft if the U.S. government could get “the majority” of the sale price.
At the same time, another possible problem is that the subsequent operations of Tencent and ByteDance’s non-US companies in the United States may also be adversely affected.
Affected by Trump’s executive order, Tencent’s stock price plummeted by 10% today, evaporating more than 500 billion Hong Kong dollars in market value.
In addition, the Trump administration has recently begun to “threaten” more Chinese companies. According to the “Wall Street Journal” report on August 6, local time, the White House introduced a proposal on the same day that plans to require Chinese companies listed in the United States to comply with US audit requirements, otherwise these companies will be forced to delist.
The report pointed out that this plan has actually been “long in the making” and has not yet been formally implemented. U.S. regulators have long been unable to check the financial auditing status of U.S.-listed Chinese companies, a situation that has sparked a lot of “controversy” in the U.S.
Under the new plan, Chinese companies that have not yet gone public but are planning an initial public offering (IPO) in the U.S. to list on the New York Stock Exchange (NYSE) or the Nasdaq (NASDAQ) Before 2022, Chinese companies listed on the New York Stock Exchange or Nasdaq must choose to comply with U.S. regulations or abandon trading. If complied with, Chinese auditors must share relevant documents with U.S. regulators.
Chinese Foreign Ministry spokesman Wang Wenbin said at a regular press conference on August 6 that Pompeo and other U.S. politicians have repeatedly used national security as an excuse to abuse state power to suppress and contain Chinese high-tech companies. China firmly opposes this. The relevant actions of the US have no factual basis at all. They are completely malicious smearing and political manipulation. The essence is to maintain its own high-tech monopoly. This completely violates market principles and international economic and trade rules, and seriously threatens the security of global industrial and supply chains. Typical bullying.
What I want to stress is that many Chinese companies currently unilaterally sanctioned by the United States are innocent, and their technologies and products are safe. There has never been a cybersecurity incident similar to the “Snowden Incident” or “WikiLeaks”. In the event, there has not been a network monitoring and monitoring behavior similar to “Prism Gate”, “Equation Organization”, and “Echelon System”. It’s absurd and ridiculous that the United States is still talking about a “clean network” with its own smudges.
We urge the US to correct its wrongdoing, create conditions for normal economic and trade cooperation between companies from all countries, and restore a free, open and secure cyberspace to the world. China will continue to work with other countries in the world to jointly maintain a fair, just, open and non-discriminatory business environment, promote international scientific and technological exchanges and cooperation, and provide safe, reliable and high-quality information technology for the recovery of the global economy and the better life of the people of all countries. new impetus.