Is Rand Paul right about who owns TikTok?
In staking out his opposition to legislation forcing the sale of the wildly popular TikTok app, Rand Paul found himself in a fight on Fox News.
“Who owns that company? ByteDance,” said host Brian Kilmeade. “ByteDance is owned by China.”
“No, it’s not,” Paul replied in a testy appearance earlier this month. “See that’s a lie…You’re defaming the company.”
As the U.S. Senate considers whether to put its stamp on the hotly contested House legislation that could potentially alienate tens of millions of young Americans in an election year, the Kentucky Republican has doggedly combated the notion that TikTok is owned by China.
“Not true,” Paul has tweeted. “60% of the company is owned by US and international investors. 20% is owned by the company founders. 20% is owned by company employees, including over 7,000 Americans. The CEO of TikTok is from Singapore, not China.”
“It’s a complicated ownership,” the Kentucky Republican told Kilmeade. “But it’s not owned by the government.”
OWNERSHIP VS. OVERSIGHT
James Lewis, an expert on technology and strategy with a focus on China at the Center for Strategic and International Studies, said while Paul is technically right on the ownership structure, he omits speaking about the overarching power structure that governs ByteDance.
“It is owned by global investors, Lewis said. “The original investors were Susquehanna, Carlyle, Sequoia, and Softbank…but there are now more. So they aren’t owned by China, but being a Chinese company headquartered in Beijing they are subject to Chinese law and control.”
TikTok’s CEO, Shou Chew, is from Singapore, and has gone to lengths to tell Congress that ByteDance isn’t controlled by the Chinese government.
But ByteDance’s headquarters is in Beijing.
And just like most other Chinese companies, ByteDance is forced to have Chinese Communist Party employees and oversight. What’s more, Zhang Fuping, a CCP secretary, is ByteDance’s editor-in-chief and vice president.
And Fuping has vowed the communist party’s committee would “take the lead” across “all product…and business lines,” which include TikTok.
“ByteDance is a Chinese company. It doesn’t matter who its shareholders are, doesn’t matter who the CEO is. It doesn’t matter how many of the board members are not Chinese. Every technology company in China under Chinese law has to do whatever the Chinese government tells them to do,” Sen. Marco Rubio of Florida recently said after a briefing on the national security risks surrounding the app.
So while the ownership is highly diversified, leadership who sit atop of the business are clearly aligned with the Chinese Communist Party.
WHO OPPOSES THE BAN?
One of the most powerful forces working against a TikTok ban is Pennsylvania billionaire financier Jeffrey Yass, whose investment company Susquehanna International Group, bought an early stake in ByteDance more than a decade ago.
Yass also happens to be a large contributor to conservative politicians, including Paul. Yass and his wife Janine, have donated more than $24 million to Paul or Paul-aligned political action committees since 2015, The Wall Street Journal reported in September.
Yass and his wife, Janine, were the third-largest conservative donors in the 2022 election cycle and thus far are the leading GOP contributors in the 2024 cycle.
Yass recently met with Republican presidential nominee Donald Trump, around the time that the former president switched his position on banning TikTok, which may have turned the tide on momentum towards the forced sale.
Public opinion on TikTok continues to sour. A survey by Echelon Insights of 1,000 likely voters this week found that 51% of Americans believe the viral video app has a negative impact on young people.
The Senate, currently on Easter recess, looks to be in no rush to take up the House-approved legislation. More likely, they’ll want to make tweaks and hold public hearings, which would mean a vote could be months away, if one is ever taken.
One of the handful of senators who haven’t taken a public position on the app: Mitch McConnell.
This story was originally published March 28, 2024 at 7:00 AM with the headline "Is Rand Paul right about who owns TikTok?."
