3 Things to Know About the TikTok Bill That Might Make a Ban All the More Likely

Update: A bill to force the sale of TikTok by ByteDance, the app’s Chinese owner, or ban the app in the U.S. passed the House of Representatives on April 20, 2024.

The House made another push to pressure TikTok out of the hands of its Chinese owner, ByteDance. This follows the bill that the House passed in March, which gave ByteDance the ultimatum to either sell or get banned. The move would affect millions of users, let alone the businesses that depend on its algorithm to reach broader markets. This time, the push coming as part of a $95 billion foreign aid bill aimed at serving American interests in Ukraine, Israel, and Taiwan. 

Lawmakers in the lower house are expected to vote on the foreign aid bill over the weekend, following its contentious journey through feuding GOP representatives. Here are three things you should know about what it means for the popular short video app: 

1. If ByteDance fails to divest within a year, it will have to pay a civil penalty worth $5,000 for each user in the U.S.  

Both versions of the bill  include a civil penalty potentially worth hundreds of billions of dollars should ByteDance fail to sell TikTok. The difference, in this case, is that the foreign aid bill is giving the company more time for the sale. It’s giving ByteDance up to a year, as opposed to a bill passed by the House last March, which gave the company a six-month deadline. 

Nevertheless, the price of non-compliance is hefty: $5,000 for each user in the country. In part, the latest bill said ByteDance would have to pay “in an amount not to exceed the amount that results from multiplying $5,000 by the number of users within the land or maritime borders of the United States…” 

This is equivalent to at least $850 billion since TikTok has more than 170 million users in the U.S.  To put this figure in context, ByteDance is estimated to be worth around $225 billion. 

2. The Chair of the Senate Commerce Committee used to have reservations. Now she supports the proposal.

Just about a month ago, the House passed a bill that would ban TikTok unless ByteDance sells it to non-Chinese buyer. Senator Maria Cantwell, a Democrat who chairs the commerce committee, had reservations during that time because she felt the deadline was too soon for the company to find a buyer.

This changed earlier this week. “As I’ve said, extending the divestment period is necessary to ensure there is enough time for a new buyer to get a deal done,” she said on X. “I support this updated legislation.” CBS News also reported that

Cantwell said more changes might come soon, “but for now, we support what they’re doing.” 

 3. Even Biden wants TikTok out.

President Joe Biden, who has more than 301,000  followers on TikTok, said that he will sign the TikTok proposal if it reaches his desk, according to the Associated Press. That would be disappointing for small businesses, who depend on it for low-cost makering and customer outreach– especially those businesses owned by people of color, according to a recent Oxford survey. Nevertheless, entrepreneurs are already looking for alternatives in case the popular app goes offline.