Who owns TikTok and why is it feared in the US?

Chinese internet giant ByteDance, known worldwide for its TikTok app, was born 12 years ago in Beijing and has become one of the most valuable companies in the world.

The app (“the app”) is now under the radar of Congress and the US President, who fear China will gain access to the personal data of millions of Americans and demand that it distance itself from its parent company and, more broadly, from China.

Here are some questions and answers about ByteDance, whose TikTok app is set to be banned in the United States following a bill approved this Wednesday in the House of Representatives, but which will still have to pass Senate scrutiny:

How important is ByteDance?

ByteDance has become one of the world’s most valuable companies with a valuation of more than 205 billion euros, according to business information company CP Insights, ahead of Elon Musk’s space company SpaceX and OpenAi, the creator of ChatGPT.

ByteDance is mainly known for creating the TikTok app, the international version of the Douyin (name in Chinese) app launched in 2016 for the Chinese market only.

TikTok currently has over one billion users.

Since its inception, ByteDance has diversified into businesses such as online trading and travel booking, and has also created a video editing app.

The company is present in more than 120 cities around the world, employs more than 150,000 people and has sales of more than 100 billion euros in 2023, according to economic news agency Bloomberg.

While not listed on a stock exchange, ByteDance is not required to publish its results, but media estimates put its turnover close to that of the world’s largest companies.

Who owns ByteDance?

TikTok said ByteDance is 60% owned by institutional investors, including US asset manager BlackRock.

According to TikTok, ByteDance’s founders own 20% of the shares, with the rest owned by the group’s employees.

The group, registered in the Cayman Islands, counts among its investors the Japanese SoftBank and the American investment fund KKR.

Also, according to TikTok, three of the five members of its board of directors are from North America.

ByteDance’s website states that 1% of Douyin is owned by a Chinese company, but TikTok said this stems from an obligation imposed by Chinese law and does not have any impact on ByteDance’s international operations.

Why is ByteDance worried about Washington?

Lawmakers in the US are concerned about ties between TikTok and Chinese authorities, seeing the risk of the personal data of 170 million North American users being transferred to China.

While TikTok has always denied the allegations, a bill approved this Wednesday by the US House of Representatives aims to force the social network to sever ties with its parent company and, more broadly, with China.

In the US, supporters of the project say that the Chinese group ByteDance cannot go against the demands of the Chinese government.

Several US states and the federal government have banned the app from being used on official government devices, citing national security risks.

What was the reaction from ByteDance and TikTok?

Both say there is no risk of North American user data being shared with Chinese authorities.

TikTok executive president Shaw Tzu Chu assured the US Congress that he has never received any requests from the Chinese government on this matter, and assured that even if he received them, he would refuse to comply.

In addition, TikTok has restructured the company to ensure that US users’ data remains in the country.

And China?

China has repeatedly said it opposes the forced sale of TikTok.

“The United States has never found evidence that TikTok poses a threat to its national security,” Chinese diplomat spokesman Wang Wenbin stressed this Wednesday, adding that banning TikTok in the US would be tantamount to “shooting one’s own foot.”