A federal judge from the U.S. District Court for the District of Columbia granted TikTok’s motion for preliminary injunction, resulting in a nationwide temporary suspension of an order from the U.S. Department of Commerce (“Commerce”) for Apple and Google to remove TikTok from its U.S. app stores. Last week, Chinese social media app WeChat was separately granted a similar injunction by a federal judge from the U.S. District Court for the Northern District of California. The two China-based smartphone apps are facing impending bans pursuant to Executive Orders (“E.O.”) 13942 (for TikTok) and 13943 (for WeChat), issued by the President on August 6, 2020.
Following the court’s ruling, Commerce issued a statement that it intends to comply with the injunction, but that it also “intends to vigorously defend the E.O. and the Secretary’s implementation efforts from legal challenges.” The preliminary injunction effectively grants TikTok’s parent company, ByteDance Ltd. (“ByteDance”), more time to finalize and obtain approval of its agreement with Oracle and Walmart. The pending deal over TikTok will still need to be reviewed and approved by both the Committee on Foreign Investment in the U.S. (“CFIUS”) and the Chinese authorities.
The court denied TikTok’s request for an additional preliminary injunction against the implementation of the second set of restrictions, which take effect on November 12, 2020. These restrictions would prevent the provision of internet hosting, content delivery networks, or other internet transit services to TikTok.
Husch Blackwell continues to monitor the TikTok and WeChat situations and will provide updates as more information becomes available. Should you have any questions or concerns regarding these potential restrictions, please contact Cortney Morgan or Grant Leach of our Export Controls & Economic Sanctions team.