The U.S. Department of Commerce has backed down from its previous order for Chinese-owned video-sharing platform TikTok to sell its assets in the United States or shut itself down.
The department said in a memo on Thursday that a court ruling has made it impossible to follow through on an order from the White House this summer that would have forbidden U.S. companies from providing any Internet services to TikTok, a social media platform that allows users to create and share short videos.
The company’s Chinese owner, ByteDance, said that the original order would have effectively made it impossible for TikTok to operate in the U.S., where it has roughly 100 million users.
The saga started over the summer when U.S. President Donald Trump railed against the company, saying it was a threat to national security because the user data would be controlled by a Chinese company. Trump signed an executive order that effectively forced the company to sell its U.S. operations to an American owner, or shut itself down by Thursday, Nov. 12.
On Oct. 30, Pennsylvania Judge Wendy Beetlestone ordered a temporary injunction against the ban on the grounds that the government’s “descriptions of the national security threat posed by the TikTok app are phrased in the hypothetical.”
That ruling could be appealed to a higher court, but on Thursday the Commerce Department said it was not planning on doing so unless directed to.
“The Department is complying with the terms of this order [and] accordingly, this serves as notice that the Secretary’s prohibition of identified transactions pursuant to Executive Order 13942, related to TikTok … WILL NOT GO INTO EFFECT, pending further legal developments.”
ByteDance came up with a framework for a deal with Oracle in September, but now that U.S. lawmakers are no longer pursuing the order, that deal is likely to fall apart.