The president Thursday, signed the order which will prohibit transactions with TikTok's Beijing-based parent company ByteDance Ltd, in 45 days.
The order is under the International Emergency Economic Powers Act, IEEPA, a 1977 law that allows the president to declare a national emergency in response to an “unusual and extraordinary threat,” allowing him to block transactions and seize assets.
The executive order states in part, “TikTok automatically gathers vast swaths of information from its users, including internet and other network activity information such as location data and browsing and search history.
This data threatens to allow the Chinese Communist Party (CCP) access to Americans’ personal and propietrary information – potentially allowing China to track the locations of Federal employees and contractors, build dossiers of personal information and blackmail, and conduct corporate espionage.”
In 45 days, TikTok will have to stop all operations in US. And tech giants, Google and Apple will have to kick the video application off their app stores Google play and Appstore respectively.
The order however gives ByteDance an out to save TikTok's operation: sell it to a US company.
The 45-day period gives US businesses time to complete severing ties with the Beijing-based company. It also gives companies like Microsoft time to try and buy TikTok.
Trump also signed additional order banning financial transactions with WeChat's parent company Tencent. "The United States must take aggressive action against the owner of WeChat to protect our national security,” the order states in part.
Tencent is one of China’s largest companies with more than a billion people utilizing the all-in-one communication platform WeChat, every month.
The company is one of China’s most valuable tech companies, and its Chief Executive Officer Pony Ma is among the many business leaders who serves as a delegate to the National People’s Congress, the communist regime’s rubber-stamp parliament.
As well as WeChat, Tencent is also a leading gaming company and its investments include a 40% stake in Epic Games - the company behind the hugely popular Fortnite video game.
“With parent companies based in China apps like Tiktok, WeChat and others are significant threats to personal data of American citizens, not to mention tools for CCP content censorship,” US Secretary of State Mike Pompeo said on Wednesday.
TikTok, said it had attempted to engage with the Trump administration for nearly a year "in good faith."
"What we encountered instead was that the administration paid no attention to facts, dictated terms of an agreement without going through standard legal processes, and tried to insert itself into negotiations between private businesses," the company said.
It is also threatening legal action to challenge the executive order. "We will pursue all remedies available to us in order to ensure that the rule of law is not discarded and that our company and our users are treated fairly - if not by the administration, then by the US courts."
Ironically, many US platforms -- like Google, Twitter and Facebook -- are banned inside China.