Trump’s TikTok Ban: Is America’s International Compliance Reputation at Risk?

By Steve Gruber

Is America’s international reputation as a leader of law and order at risk because of Trump’s ban on TikTok? The short answer: yes and no. The long answer highlights the story behind the problem and shows that Tik Tok isn’t that innocent of a player here. At the same time, the executive orders on TikTok and WeChat aren’t doing well in the courts either.

How Will This Ban Work?

On August 6, 2020, President Trump signed an executive order banning United States business with TikTok and WeChat. He cited the International Emergency Economic Powers Act (IEPA) and the National Emergencies Act (NEA).

The changes laid out in the executive order were expected to roll out on September 20. By August 16, a new executive order amended the deadline from 45 days to 90 days, with the changes now expected to roll out by November 12, after the general election.

TikTok hit back in an August blog post saying the executive order risked America’s standing as a nation that complies with the law, and that the order did not undergo due process.

It is estimated that approximately 80 million Americans who use TikTok could be impacted by this.

What Does it Mean?

The International Emergency Economic Powers Act (IEPA) gives the President the right to ban transactions, which typically target financial accounts and transfers by terrorists, international criminals, and human rights abusers, and is used around 1.5 times a year. Someone funneling money to family members in Bahrain, for example, may see some IEPA enforcement.

While somewhat dissimilar to previous uses of the IEPA, even seemingly-harmless TikTok and WeChat activity is constantly associated with financial transactions from advertisers and paying users and thus legally falls under the scope of the transactions mentioned in the IEPA. Whether Congress envisioned these types of transactions falling under the IEPA is another question.

TikTok is Not That Innocent

I think a lot of people start out by saying, Trump likes to curb people’s speech and go after big tech companies, and this is just another example of the same.

But it’s important for people to know that TikTok isn’t just an unlucky innocent Trump target. Chinese law requires a certain level of symbiosis and between Chinese companies and Communist security and intelligence forces.

That doesn’t mean that they are necessarily handing over confidential American data to the Chinese government, but it does mean that if the Chinese government ever wants access to that data, there’s nothing stopping them from requiring access to it. And while TikTok tries to paint a picture of independence from the government, t is somewhat telling that TikTok has previously targeted and taken down videos from the Hong Kong protests, videos showing mistreatment of Muslims in China’s Xinjiang Region, and videos of standoffs at the India/China border — all things that the Chinese government has sought to censor.

At the same time, there is a history of TikTok misusing information, including those of minor children. The FCC has actually settled a dispute with TikTok and imposed a significant fine. The FCC has also extracted a written promise from TikTok over the misuse of children’s personal information. And there is currently an ongoing FCC investigation regarding that breach of the agreement.

China’s History of IP Theft

China has also long been caught committing IP theft and espionage in the United States and hacking US citizen profiles — activities that would become even more effective with access to even some of the data offered in TikTok and WeChat’s servers. Chinese nationals have often been caught taking trade secrets back to China after working for or with companies like Apple, T-Mobile, and GE. For instance, there’s evidence that 20% of Chinese wind turbines are running on stolen US software, And the FBI currently has around 1,000 ongoing cases on perceived Chinese trade secret theft.

With access to confidential personal data on US citizens, Chinese security forces can more effectively generate and target phishing campaigns at US citizens and thereby gain access to more valuable information through the weakest chink in American cybersecurity armor — human error. Sometimes those odd e-mails seemingly coming from someone you know, but with a very odd and long e-mail address aren’t just criminals trying to scam money from unsuspecting grandmothers. Sometimes foreign government security officers are behind those phishing attempts.

With China’s history of IP theft, and the value that confidential personal data can pose to Chinese security forces, the US government has at least a significant interest in preventing the Chinese government from accessing US citizen confidential data through WeChat and TikTok — an interest that may or may not outweigh first amendment rights to free speech.

Related: China Seeks Patent on US Covid-19 Drug

The Constitutionality of the TikTok Ban

The courts are currently asking whether that interest is great enough and whether the Executive Order is narrowly-tailored enough to that interest, to survive Constitutional scrutiny. Two Federal Appeals courts have already weighed in against the Trump administration, though only one of the two on Constitutional grounds.

A Washington D.C. judge, nominated by Trump, struck down the Executive Order saying that the administration is breaching the very IEPA rules that it relies on, because of a 1988 amendment that sought to exclude most forms of communication from the reaches of the IEPA. Since films, records, photographs, and art were excluded from the scope of the IEPA, the DC judge ruled that communications on TikTok should similarly be excluded from the types of transactions that the IEPA could go after.

The judge also noted that while the government’s overarching national security interest is significant, the government didn’t show enough evidence that banning TikTok or WeChat would address these concerns (i.e., the law wasn’t narrowly tailored enough to the government interest). In other words, there are both legal and constitutional issues with the ban. At the same time, the judge agreed that the Administration had shown ample evidence that China presents a significant national security threat.

What About Due Process?

TikTok has had almost a year to deal with this situation, and there’s little evidence that it has made efforts to appease the administration’s security concerns. Any suggestion that due process has not been afforded ignores this long timeline given to TikTok. At the same time, even a shorter period of response than given here would not be at odds with previous IEPA norms.

In 2015, President Obama used IEPA to go after cybercriminals without any prior notice being afforded. In that instance, there was a specific provision stating that no prior notice need be given before the assets of those individuals were received.

Trump’s order has been seen as breaching IEPA. That could put a ding on America’s compliance reputation. But to suggest that TikTok is completely innocent here isn’t aligned with reality. It’s not just a constitutional matter, it’s a national security matter, and one we should give some serious thought to.

With the rise of social media, more and more we give away our personal information and intellectual property. But where do we draw the line? If you have any questions about IEPA or intellectual property protections in the age of social media, give us a call.

Keep Reading: TikTok Tick Tock — Can You Claim Copyright on a Dance Move?