TikTok: Frequently Asked Questions and Issues April 9, 2024
for Congress
Michael D. Sutherland,
Since 2018, the social media application TikTok, developed and owned by ByteDance Ltd.
Coordinator
(ByteDance), has become one of the most popular social media platforms in the United States,
Analyst in International
and raised oversight and legislative issues for Congress. With short-form video format and
Trade and Finance
sophisticated content recommendation algorithms and usability design, TikTok achieved

significant market penetration in the United States, amid competition with other social media
Kristen E. Busch,
platforms such as Meta (formerly Facebook), Instagram, X (formerly Twitter), and Snapchat.
Coordinator
Analyst in Science and
TikTok’s short-form video application was initially developed by musical.ly, a company founded
Technology Policy
in the People’s Republic of China (PRC or China), but primarily operating in the United States.

In 2018, musial.ly was acquired by ByteDance, a firm incorporated in Cayman Islands with
Peter J. Benson,
headquarters in Beijing, China, and relaunched as TikTok, operated by TikTok Ltd., also
Coordinator
incorporated in the Cayman Islands and headquartered in Los Angeles and Singapore. TikTok
Legislative Attorney
Ltd. is owned by ByteDance Ltd. TikTok is not available in China.

Since its launch in the United States, some policymakers, technical experts, and Members of
For a copy of the full report,
Congress have expressed concerns regarding TikTok’s ownership structure and potential
please call 7-5700 or visit
implications for U.S. national security and the data privacy and security of U.S. users. Some
www.crs.gov.
Members have argued that ByteDance, as a PRC-headquartered company, is subject to potential
PRC government pressure through various PRC laws and regulations governing intelligence, cybersecurity, and data security.
They argue that the PRC government could apply these laws and regulations to compel ByteDance to turn over U.S. user
data. Some Members have contended that the PRC government could potentially use TikTok as a platform for influencing
public opinion in the United States or conducting malign activities such as spreading misinformation or interfering in
elections. Some Members have also expressed broader concerns related to TikTok’s content moderation and online safety
policies, particularly those that govern online protection for minors. Proponents of TikTok emphasize its role as a platform
for accessing information, sharing content, generating revenue for small businesses and entrepreneur, as well as its relatively
similar data and content moderation practices compared to other social media competitors.
To date, both the executive branch and Congress have taken actions to address concerns about TikTok’s ownership structure
and implications for national security and data privacy. In 2020, the Trump Administration issued orders that would, among
other things, prohibit U.S. entities from conducting transactions with TikTok and require TikTok’s parent company
ByteDance to divest from TikTok. TikTok challenged these actions in court. In January 2021, the Biden Administration
rescinded some of the Trump Administration’s actions and issued new executive actions to address the broader national
security implications of PRC social media platforms in the United States. In the 118th Congress, Members have introduced
legislation to build on and expand existing executive authorities and actions taken against TikTok, including S. 686, the
Restricting the Emergence of Security Threats that Risk Information and Communications Technology Act (RESTRICT
Act), which was introduced in the Senate, and H.R. 7521, The Protecting Americans from Foreign Adversary Controlled
Applications Act, which passed the House on March 13, 2024.
This report compiles responses to frequently asked questions (FAQs) regarding TikTok, its ownership and the corporate
structure of ByteDance Ltd., and potential national security and data privacy concerns related to the platform. This report also
summarizes past executive action and legislation that sought to address these concerns, and examines potential constitutional
considerations and policy implications for legislation and oversight that Congress could consider related to TikTok.

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TikTok: Frequently Asked Questions and Issues for Congress

Background
This report compiles frequently asked questions (FAQs) regarding TikTok, its ownership and the
corporate structure of ByteDance Ltd., and potential national security and data privacy concerns
related to the platform. This report also summarizes past executive action and legislation that
sought to address these concerns, and examines potential constitutional considerations and policy
implications for legislation and oversight that Congress could consider related to TikTok.
TikTok’s Functionality, Users, and Business
Operations
What is TikTok?
TikTok is a social media application—one of the most popular social media platforms in the
United States—that allows users to easily generate, post, and share short-form videos, typically
ranging from 15 to 60 seconds in length. TikTok selects and displays videos for individual users
based on their user interactions (likes, shares, and comments), video metadata (hashtags, captions,
and sounds), and the device and account settings (language preference, device type, etc.). TikTok
is owned by TikTok Ltd., a subsidiary of ByteDance Ltd. (hereinafter referred to as ByteDance),
and is the global counterpart to Douyin, ByteDance’s short-form video application that the
company launched for users in China in 2016.1 TikTok and Douyin share certain core features,
though they reportedly use separate algorithms tailored to promote content to their respective
audiences.2
How many users does TikTok claim to currently have?
According to TikTok’s estimates, as of March 2024, its user base had more than 170 million
monthly active users (MAUs) in the United States and 7 million businesses that market or
advertise on the platform.3 In 2021, TikTok announced that it had surpassed more than 1 billion
MAUs across the world.4According to the Pew Research Center, TikTok “stands out for growth of
its user base” among U.S. adults, with 33% of adults reporting using it in 2023, up 12% from
2021.5
How did TikTok become so popular?
Some experts attribute the rapid growth of TikTok’s user base in the United States in part to the
ByteDance 2018 acquisition of competitor musical.ly, which had an estimated base of
approximately 100,000 U.S. MAUs at the time of the acquisition.6 In August 2018, ByteDance

1 Emma Lee, “Toutiao Parent Launches Global Competitor to musical.ly,” Technode, September 14, 2017.
2 Su, C., & Valdovinos Kaye, B. “Borderline practices on Douyin/TikTok: Content transfer and algorithmic
manipulation,” 2023, Media, Culture & Society, 1534–1549, available at https://doi.org/10.1177/01634437231168308.
3 TikTok, “Oxford Economics Reports: TikTok Contributed $24 Billion to U.S. Economy in 2023,” March 13, 2024,
available at https://newsroom.tiktok.com/en-us/tiktok-economic-impact-report-2024-smb.
4 TikTok, “Thanks a billion!” September 27, 2021, https://newsroom.tiktok.com/en-us/1-billion-people-on-tiktok.
5 Jeffrey Gottfried, “Americans’ Social Media Use,” Pew Research Center, January 31, 2024,
https://www.pewresearch.org/internet/2024/01/31/americans-social-media-use/
6 William Alan Reinsch, Patrick Saumell, et.al, “TikTok Is Running out of Time: Understanding the CFIUS Decision
and Its Implications, Center for Strategic and International Studies, September 2, 2020.
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officially rebranded the musical.ly app as TikTok and migrated musical.ly users to new TikTok
accounts.7 A key feature of TikTok’s service is the company’s recommendation algorithm, which
is a system that sorts, curates, and disseminates content deemed relevant to specific users.
Who owns TikTok?
TikTok Ltd., a holding company incorporated in the Caribbean Overseas British Territory of
Cayman Islands, directly owns TikTok. ByteDance Ltd., a holding company incorporated in the
Cayman Islands and with core business operations and leadership located in China, directly owns
TikTok Ltd.8 TikTok Ltd. lists its global headquarters as Los Angeles and Singapore.9 Its Chief
Executive Officer (CEO), Shou Zi Chew, a citizen of Singapore, operates out of both headquaters,
according to statements Chew made to a U.S. media outlet in February 2024.10
Who owns ByteDance and where is it located?
ByteDance is incorporated in the Cayman Islands. The company has listed its operational
headquarters and primary place of business as Beijing, China (PRC or China).11 Some legal
experts also note that the majority of granted patents related to ByteDance’s core software
applications are registered in China and held by Beijing Douyin Information Services Co., Ltd., a
subsidiary of ByteDance that houses ByteDance’s key personnel, infrastructure, and conducts the
firm’s operations in China. In March 2023 testimony before the House Energy and Commerce
Committee, TikTok CEO Shou Zi Chew, when asked whether ByteDance is a PRC company, said
“ByteDance owns many businesses that operate in China,” and “was founded by Chinese
entrepreneurs.”12 In January 2024 testimony before the Senate Judiciary Committee, Shou stated
that “ByteDance is a global company and not a Chinese company.”13
What is ByteDance’s relationship to the People’s Republic of China (PRC)?
ByteDance is a privately-held company, and details on its global operations and ultimate
shareholding structure are not widely available, beyond information published by ByteDance.
Several experts and policymakers consider ByteDance to be ultimately subject to the jurisdiction
of the PRC.14 In its official corporate structure, ByteDance currently lists all of its global

7 Dami Lee, “The popular Musical.ly app has been rebranded as TikTok,” The Verge, August 2, 2018.
8 Marks & Clerk, “Artificial Intelligence fuels TikTok’s popularity; but could that very asset prevent its sale?”
September 15, 2020, available at https://www.lexology.com/library/detail.aspx?g=3f68400b-2d73-43e2-88d5-
510c85ea6759.
9 TikTok, “About TikTok,” available at https://www.tiktok.com/about?lang=en.
10 Dexter Thomas, “Over Time the Trust Will Come’: An exclusive Interview With TikTok’s CEO,” Wired, February
1, 2024.
11 Leadership and management position vacancies currently listed at ByteDance appear to be based in the company’s
Beijing, Shanghai, and Hong Kong offices: https://jobs.ByteDance.com/en/position?location=CT_11. For broader
profiles of the company’s operations in China, see Wei Sheng and Tony Xu, “A tour of ByteDance headquarters,”
Technode, September 11, 2019; Jing Yang and Juro Osawa, “ByteDance’s China Business is Slowing, Putting
Spotlight on TikTok,” The Information, August 10, 2023.
12 House of Representatives Committee on Energy and Commerce, TikTok: How Congress Can Safeguard American
Data Privacy and Protect Children From Online Harms, Hearing, 118th Congress, 1st sess., March 23, 2023, p. 131,
https://www.congress.gov/118/meeting/house/115519/documents/HHRG-118-IF00-Transcript-20230323.pdf.
13 U.S. Senate Committee on The Judiciary, Big Tech and the Online Child Sexual Exploitation Crisis, Full Committee
Hearing, January 31, 2024, https://www.judiciary.senate.gov/committee-activity/hearings/big-tech-and-the-online-
child-sexual-exploitation-crisis.
14 Roger Chen and Rui Ma, “How ByteDance Became the World’s Most Valuable Startup,” Harvard Business Review,
(continued...)
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subsidiaries and offices, including its original PRC-based firm Beijing ByteDance Technology
Co., Ltd. (Beijing ByteDance), as subsidiaries of ByteDance, Ltd. in the Cayman Islands. In
February 2023, ByteDance published an updated corporate structure in which it had renamed
Beijing ByteDance as Beijing Douyin Information Services Co., Ltd. (Beijing Douyin).15
ByteDance uses a variable interest entity (VIE) structure.16 China prohibits foreign investors from
investing in China’s internet and telecommunications companies (among other types of
companies). To access international capital under these restrictions, firms in China’s technology
sectors (including ByteDance) frequently use a VIE structure. This structure relies on an offshore
holding company tied through a series of contracts to the PRC firm, which holds the core assets
and conducts the firm’s global business. Overseas investors invest in the offshore entity,
commonly a holding company incorporated in a jurisdiction such as the Cayman Islands or
British Virgin Islands, and receive a share of the firm’s revenue without making any direct equity
investment in the core assets of the business.17
Is TikTok available in China?
Internet users in China are not able to easily access TikTok; they are able to access Douyin,
TikTok’s predecessor-turned-companion-application.18 U.S. and multinational digital platforms,
including TikTok, are unable to operate legally in China due to restrictions on foreign investment
and operations in various technology sectors.19
National Security and Data Privacy Concerns
Is ByteDance a PRC company?
ByteDance’s executives have maintained that ByteDance’s incorporation in the Cayman Islands
means that it should not be considered a PRC company. PRC officials have referred to ByteDance
as a PRC company and have cited the company’s obligations to comply with PRC data security
and export control regulations as factors that may impede or block a ByteDance divestment from
TikTok.20

February 24, 2022; Yaqiu Wang, “The Problem with TikTok’s Claim of Independence From Beijing,” Human Rights
Watch, March 24, 2023.
15 For a graphical representation of ByteDance’s corporate structure (as published by the company), see
https://www.bytedance.com/en/.
16 For more details on the variable interest entity structure, see CRS In Focus IF11803, U.S. Capital Markets and
China: Issues for Congress, by Michael D. Sutherland and Karen M. Sutter; U.S. Securities and Exchange
Commission, “Investor Bulletin: U.S.-Listed Companies Operating Chinese Businesses Through a VIE Structure,”
September 20, 2021.
17 For more details on the variable interest entity structure, see CRS In Focus IF11803, U.S. Capital Markets and
China: Issues for Congress, by Michael D. Sutherland and Karen M. Sutter; U.S. Securities and Exchange
Commission, “Investor Bulletin: U.S.-Listed Companies Operating Chinese Businesses Through a VIE Structure,”
September 20, 2021.
18 Zeyi Yang, “How China Takes Extreme Measures to Keep Teens Off TikTok,” MIT Technology Review, March 8,
2023.
19 Beina Xu and Eleanor Albert, “Media Censorship in China,” Council on Foreign Relations, February 17, 2017.
20 Xinhua, “Planned TikTok Deal Entails China’s Approval under Revised Catalogue: Expert,” August 30, 2020; China
Global Television Network, “MOFCOM: China will firmly oppose a forced sale of TikTok,” March 24, 2023;
Meaghan Tobin, “China Condemns U.S. Proposal to Force the Sale of TikTok,” New York Times, March 13, 2024.
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Some experts contend that the PRC government controls ByteDance, or at least exerts a degree of
influence over ByteDance, through a 2021 investment in Beijing Douyin Information Services
Co., Ltd. (Beijing Douyin) (the entity that owns TikTok’s core technology) by
WangTouZhongWen (Beijing) Technology.21 The company financed its stake in ByteDance with
funding from the China Internet Investment Fund (CIIF), a PRC government-run investment fund
capitalized by joint capital contributions from the Cyberspace Administration of China (CAC)
and China’s Ministry of Finance.22 Through this investment, WangTouZhongWen—and the CIIF
by extension—acquired a 1% stake in Beijing Douyin and a seat on the firm’s board.23 Some
experts describe this 1% share as a “golden share,” a reference to the PRC government’s strategy
of making small, targeted investments that, in the view of these experts, gives the PRC
government visibility, influence, and control over the decisions and operations of certain strategic
firms in China’s private sector.24 Following this acquisition in December 2021, CAC official Wu
Shugang was appointed to Beijing Douyin’s board of directors.25
Does the government of the People’s Republic of China (PRC) exercise control
over ByteDance?
The PRC government has tools that it may use to exert control over ByteDance (and potentially
by extension TikTok) and other PRC digital platform developers. These tools may include, for
example:
• Communist Party of China (CPC) Party Organizations: Since 1993, the PRC
government has required companies in China’s private sector that employ three
or more Party members to establish internal Party organizations. Since becoming
CPC General Secretary in 2013, Xi Jinping has taken action to expand the role
and influence of Party organizations inside PRC firms,26 including in the
selection of executives in larger PRC companies.27
• Official Content Guidelines and Censorship Rules: The PRC government
maintains a robust online censorship regime that it uses to shape the content
published to China’s social media platforms. Some observers have cited instances
of content suppression and promotion that TikTok and ByteDance representatives
later acknowledged.28

21 Keith Zhai, “China Steps Up Direct Involvement in Internet-Content Firms,” Wall Street Journal, August 17, 2021.
22 Zheping Huang, “Beijing Tightens Grip on ByteDance with Rare China Board Seat,” Bloomberg, August 17, 2021.
23 Juro Osawa and Shai Oster, “Beijing Tightens Grip on ByteDance by Quietly Taking Stake, China Board Seat,” The
Information, August 16, 2021.
24 Ryan McMorrow, Qianer Liu, and Cheng Leng, “China moves to take ‘golden shares’ in Alibaba and Tencent units,”
Financial Times, January 12, 2023.
25 “Fretting About Data Security, China’s Government Expands Its Use of ‘Golden Shares’,” Reuters, December 16,
2021.
26 Scott Livingston, “The New Challenge of Communist Corporate Governance,” Center for Strategic and International
Studies, January 15, 2021.
27 “Chinese Communist Party Cells in Private Companies: Though Not Yet Universal, Increasingly Situated to Play
Greater Roles in Corporate Governance,” Sayari, April 7, 2021.
28 In September 2019, a review of TikTok internal guidelines published by The Guardian revealed that TikTok had
been suppressing the visibility of (and in some cases removing) content that could be seen as portraying LGBTQ+
individuals or their lifestyles positively, alongside content that was deemed politically sensitive to Beijing. TikTok later
stated that it had also been suppressing the visibility of content that portrayed individuals that were overweight or
displayed conspicuous disabilities, noting that elements of the policy were adopted to comply with broader ByteDance
(continued...)
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• Data Security, Export Controls, and Cybersecurity Regulations: The PRC
government has applied existing cybersecurity and data security laws to influence
corporate activity in China. PRC officials have indicated that they could apply
China’s export control laws to block ByteDance from divesting TikTok, stating
that social media algorithms developed by PRC firms fall under China’s export
control regulations.29
What laws and regulations in China could influence ByteDance operations?
Since 2015, the PRC government and the CPC have adopted interrelated laws, economic
security measures, and data restrictions that enhance their control over data and
commercial activity within and outside of China, which could influence ByteDance
operations. They have expanded data localization requirements, placed data under export
controls, and, since 2021, required security reviews for PRC firms listing or operating
overseas. Some PRC provisions require firms to adhere to PRC requirements even when
those requirements conflict with U.S. laws. Relevant laws in China include, for example:
• The PRC National Security Law (2015) requires information systems in China
to be “secure and controllable.” Since 2016, the PRC government has required
U.S. technology firms to store data and cryptographic keys in China.30
• The PRC National Cybersecurity Law (2017) requires firms to store personal
information and data within China, and it underpins requirements to place PRC
data and related infrastructure in China.31
• The PRC Data Security Law (2021) covers data processing inside and outside
of China if it “harms the national security, public interest, or the legitimate rights
and interests of citizens or organizations of the PRC.” The law requires PRC
government approval for the transfer of data stored in China and calls for
classifying data according to its importance to China’s economic development
and national security interests.32
• In August 2020, the PRC government added algorithms used in social media
platforms to China’s Catalogue of Technologies Prohibited and Restricted
from Export, which is regularly updated according to China’s Export Control
Law (2020).33 The addition followed the Trump Administration’s announcement

content moderation policies, and that those policies had been replaced with localized content moderation guidelines. In
2020, TikTok released an apology message for a “technical glitch” that made it “temporarily appear as if posts
uploaded using #BlackLivesMatter and #GeorgeFloyd would receive 0 views. See Alex Hern, “TikTok’s local
moderation guidelines ban pro-LGBT content,” The Guardian, September 26, 2019; Umberto Bacchi, “TikTok
apologises for censoring LGBT+ content,” Reuters, September 22, 2020; Vanessa Pappas and Kudzi Chikumbu, “A
message to our Black community,” TikTok June 1, 2020.
29 Rafaelle Huang, “China Signals Opposition to Forced Sale of TikTok in the U.S.,” Wall Street Journal, March 15,
2024.
30 National Security Law of the People’s Republic of China, July 1, 2015, English translation available at
https://www.chinalawtranslate.com/en/2015nsl/#:~:text=Article%201%3A%20This%20Law%20is,of%20the%20refor
m%20and%20opening.
31 Cybersecurity Law of the People’s Republic of China, June 1, 2017, English translation available at
https://digichina.stanford.edu/work/translation-cybersecurity-law-of-the-peoples-republic-of-china-effective-june-1-
2017/.
32 Data Security Law of the People’s Republic of China, September 1, 2021, English translation available at
https://digichina.stanford.edu/work/translation-data-security-law-of-the-peoples-republic-of-china/.
33 Export Control Law of the People’s Republic of China, October 17, 2020, English translation available at
https://www.chinalawtranslate.com/en/export-control/.
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earlier in August 2020 of executive actions targeting PRC social media
applications, including TikTok.34
Does ByteDance share user data with the government of the People’s Republic
of China (PRC)?
TikTok has denied that it shares data with the PRC government or the CPC. In its responses to
Questions for the Record following TikTok CEO Shou Zi Chew’s testimony in March 2023
before the House Energy and Commerce Committee, TikTok provided a response indicating that
the company “has never shared, or received a request to share, U.S. user data with the Chinese
government.”35 In response to Questions for the Record about ByteDance and its adherence to
PRC government policies, TikTok provided a response indicating that “ByteDance’s products
follow the local laws and regulations of the countries they operate in.”36 Neither TikTok nor
ByteDance have issued a statement to date on whether ByteDance or any of its subsidiaries in
China have received requests to share data from the PRC government. One former ByteDance
executive reportedly has alleged that ByteDance did share certain user data with the company’s
internal CPC committee.37
Where does TikTok store user data?
TikTok provided a response to Questions for the Record following CEO Shou Zi Chew’s March
2023 testimony before the House Energy and Commerce Committee, indicating that at least seven
years’ worth of U.S. users’ TikTok data—specifically data related to paid content creators—is
stored in data centers located in China.38 As part of its efforts related to Project Texas (an
initiative started by TikTok that it has claimed would address U.S. government security concerns),
TikTok issued a statement indicating that it is “committed to storing all U.S. user data in the
United States” in cooperation with Oracle and other U.S. firms. (See What is Project Texas?)
TikTok also has issued statements claiming that, “as of July 2022, all new U.S. user data is stored
automatically in Oracle’s U.S. cloud infrastructure, and access is managed exclusively by the
TikTok US Data Security Team.”39 Some experts contend that whether and where TikTok stores
data could potentially be unrelated to the Chinese government’s ability to access TikTok’s data—
as reported in 2022, there appear to be incidences of ByteDance employees located in China
remotely accessing U.S. TikTok user data from ByteDance offices in Beijing in support of Project
Texas.40

34 “Planned TikTok deal entails China’s approval under revised catalogue: expert,” Xinhua, August 30, 2020.
35 TikTok, Additional Responses to Questions for the Record¸ May 4, 2023, p. 13, available at
https://docs.house.gov/meetings/IF/IF00/20230323/115519/HHRG-118-IF00-Wstate-ChewS-20230323-SD030.pdf.
36 Ibid.
37 In June 2023, a former ByteDance executive who was engaged in litigation against the company claimed that
ByteDance’s internal CPC committee was granted access to data of users based in Hong Kong in 2018. The former
executive claimed that this access was to facilitate efforts to pressure ByteDance internally to support the PRC
government’s efforts at the time to crack down on Hong Kong’s pro-democracy movement. ByteDance denies the
claim. Georgia Wells, “Former ByteDance Executive Claims Chinese Communist Party Accessed TikTok’s Hong
Kong User Data,” Wall Street Journal, June 5, 2023.
38 TikTok, Additional Responses to Questions for the Record¸ May 4, 2023, p. 13, available at
https://docs.house.gov/meetings/IF/IF00/20230323/115519/HHRG-118-IF00-Wstate-ChewS-20230323-SD030.pdf.
39 TikTok, “TikTok Facts: How we secure personal information and store data,” press release, October 12, 2023.
40 Emily Baker-White, “Leaked Audio From 80 Internal TikTok Meetings Shows That US User Data Has Been
Repeatedly Accessed From China,” Buzzfeed News, June 17, 2022.
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The U.S.-based company Oracle currently provides cloud infrastructure for TikTok. According to
TikTok, “100% of [U.S.] user traffic is being routed to Oracle Cloud Infrastructure” and U.S. and
Singapore data centers are used as backup.41
How does TikTok moderate content and recommend content?
TikTok has maintained that its content moderation policies and recommendation algorithms
operate independently of ByteDance and its other products, and that TikTok tailors these policies
and recommendation algorithms to be compliant with the laws of each country where it operates
and also to promote content specific to each country where it operates.42 In its responses to
Questions for the Record following TikTok CEO Shou Zi Chew’s March 2023 testimony before
the House Energy and Commerce Committee, TikTok indicated that it promotes certain content
but claimed that it does not do so at the request of any government.43 Some observers have cited
instances of content suppression and promotion that TikTok and ByteDance representatives later
acknowledged.44
Efforts to Regulate TikTok
What actions has the executive branch taken to address alleged national
security risks TikTok poses?
With regard to ByteDance and TikTok, the executive branch has sought to address identified
national security concerns related to the firms’ presence and operations in the United States using
two separate authorities and legal frameworks: (1) the Committee on Foreign Investment in the
United States (CFIUS), and (2) the International Emergency Economic Powers Act (IEEPA).
These two actions are discussed in the questions that immediately follow.
What are the details of the Committee on Foreign Investment in the United
States (CFIUS) investigation of the ByteDance acquisition of musical.ly?
In 2019, CFIUS conducted a retroactive national security review and investigation of the
ByteDance completed acquisition of musical.ly, which had originally not been submitted by the
parties for CFIUS review.45 Following its investigation, CFIUS referred the transaction to
President Trump for a presidential decision. The presidential decision, issued in March 2020,
concluded that the acquisition threatened U.S. national security.46 In referring the case to the
President, CFIUS signaled it could not mitigate the identified national security risks arising from

41 Albert Calamug, “Delivering on our US data governance,” TikTok, June 17, 2022, available at
ttps://newsroom.tiktok.comen-us/delivering-on-our-us-data-governance; TikTok, “The Truth About TikTok: Separating
Fact from Fiction,” press release, April 17, 2023.
42 TikTok, “The Truth About TikTok: Separating Fact from Fiction,” press release, April 17, 2023.
43 TikTok, Additional Responses to Questions for the Record¸ May 4, 2023.
44 See footnote 28.
45 The Committee on Foreign Investment in the United States (CFIUS) is an interagency committee chaired by the
Secretary of the Treasury. It serves the President in overseeing the national security risks of certain foreign direct
investment (FDI) in the U.S. economy. For more details, see CRS In Focus IF11334, CFIUS: New Foreign Investment
Review Regulations, by Cathleen D. Cimino-Isaacs.
46 White House Office of the Press Secretary, “Regarding the Acquisition of Musical.ly by ByteDance, Ltd.,” August
14, 2020, https://home.treasury.gov/system/files/136/EO-on-TikTok-8-14-20.pdf.
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the transaction. CFIUS does not publicly comment on investigations or mitigation negotiations,
including with respect to TikTok.
What actions followed the 2019 Committee on Foreign Investment in the
United States (CFIUS) investigation of the ByteDance acquisition of
musical.ly?
In August 2020, President Trump concluded that the ByteDance acquisition of musical.ly
threatened U.S. national security and issued a Presidential Order under CFIUS’s authorities
directing ByteDance to divest (1) any asset or property used to enable or support the operation of
TikTok in the United States and (2) data obtained or derived from TikTok or musical.ly app users
in the United States.47 In a statement issued following the order, then-Treasury Secretary Steven
Mnuchin said that “CFIUS conducted an exhaustive review of the case and unanimously
recommended this action to the President in order to protect U.S. users from exploitation of their
personal data.”48
In November 2020, ByteDance and TikTok contested the order through a legal challenge,
arguing, among other things, that the order was an unconstitutional taking of their private
property without just compensation and that it violated their due process rights under the Fifth
Amendment.49 The case is currently held in abeyance at the request of both parties. The court
directed the government to file status reports every 60 days, and the government has reported as
directed. According to the February 2024 report, the parties continue to negotiate whether the
litigation can be resolved by mutual agreement.50
What actions did the U.S. government take under International Emergency
Economic Powers Act (IEEPA) authorities?
IEEPA51 gives the President broad authority to block a variety of economic transactions following
the declaration of a national emergency.52 Based on the national emergency declared in E.O.
13873 in May 2019, in August 2020 President Trump issued E.O. 13942, which exercised
authority provided by IEEPA to restrict TikTok’s U.S. operations.53 The then-Secretary of
Commerce subsequently implemented this order by issuing a list of prohibited transactions,
including maintaining TikTok on a mobile app store or providing internet hosting services to it.54

47 Executive Office of the President, “Regarding the Acquisition of Musical.ly by ByteDance Ltd.,” 85 FR 51297,
August 14, 2020.
48 U.S. Department of the Treasury, “Statement by Secretary Steven T. Mnuchin on the President’s Decision Regarding
the Acquisition by ByteDance Ltd. of the U.S. Business of musical.ly,” August 14, 2020.
49 Petition for Review, TikTok v. CFIUS, No. 20-1444 (D.C. Cir. Nov. 10, 2020).
50 Status Report, TikTok v. CFIUS, No. 20-1444 (D.C. Cir. Feb. 20, 2024).
51 P.L. 95-223, 91 Stat. 1626 (1977) (codified as amended at 50 U.S.C. §§1701–1708).
52 50 U.S.C. § 702(a). For further background on the President’s powers under IEEPA, see CRS Report R45618, The
International Emergency Economic Powers Act: Origins, Evolution, and Use, coordinated by Christopher A. Casey.
53 Executive Order 13942, “Addressing the Threat Posed by TikTok, and Taking Additional Steps to Address the
National Emergency With Respect to the Information and Communications Technology and Services Supply Chain,”
85 Federal Register 48637, August 11, 2020.
54 Department of Commerce, “Identification of Prohibited Transactions to Implement Executive Order 13942 and
Address the Threat Posed by TikTok and the National Emergency With Respect to the Information and
Communications Technology and Services Supply Chain,” 85 Federal Register 60061, September 24, 2020.
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Have the actions the U.S. government took under International Emergency
Economic Powers Act (IEEPA) authorities been challenged in court?
Two lawsuits were filed challenging E.O. 13942: one brought by TikTok and its parent company
ByteDance,55 and the other brought by a group of TikTok users.56 The plaintiffs in these suits
argued, among other things, that the President exceeded his authority under IEEPA by regulating
conduct that they contended falls under two statutory exceptions.57 First, under the personal
communication exception, the President may not rely on IEEPA to regulate or prohibit any
“personal communication, which does not involve a transfer of anything of value.” 58 Second,
under the informational materials exception, the President may not rely on IEEPA to regulate or
prohibit the importation or exportation of most “informational materials.”59 The plaintiffs argued
that TikTok’s core function—creating and sharing short-form videos—involved transmitting
personal communications and informational materials, albeit in a modern format.60
In both suits, the courts issued preliminary injunctions temporarily barring the United States from
enforcing the restrictions.61 In June 2021, before the injunctions expired, the Biden
Administration rescinded E.O. 13942 and replaced it with a broader E.O. 14034. E.O. 14034
directs the Secretary of Commerce to create a program to identify and address the potential
national security risks arising from foreign internet-based and software-tied operations in the
United States. These could include apps that are operated by entities owned by, controlled by, or
subject to the jurisdiction of the PRC or other countries the Secretary of Commerce has
designated as “foreign adversaries.”62
What legislation has Congress introduced to regulate TikTok?
In 2022, Congress enacted a law directing the Office of Management and Budget (OMB) to
develop standards and guidelines that require executive agencies to remove TikTok from
government computers and other government information technology.63 On February 27, 2023,
OMB issued implementation guidance, which included instructions and deadlines for removing
TikTok from federal devices.64

55 Complaint, TikTok v. Trump, 1:20-cv-02658 (D.D.C. Sept. 18, 2020) [hereinafter TikTok Complaint].
56 Amended Complaint, Marland v. Trump, 2:20-cv-04597 (E.D. Pa. Oct. 1, 2020) [hereinafter TikTok Users
Complaint].
57 See TikTok Complaint, supra footnote 55, at ¶¶ 75–81; TikTok Users Complaint, supra footnote 56, at ¶¶ 73–79.
58 50 U.S.C. §1702(b)(1).
59 Ibid. §1702(b)(2).
60 See Memorandum In Support of Plaintiff’s Motion for Preliminary Injunction, TikTok v. Trump, 1:20-cv-02658, at
18–20 (Sept. 23, 2020); Memorandum of Law In Support of Plaintiffs’ Motion for Preliminary Injunction, Marland v.
Trump, 2:20-cv- 04597, at 21–22 (Oct. 13, 2020).
61 In the case brought by TikTok and ByteDance, the court concluded that the plaintiffs were likely to prevail on the
argument that the ban ran afoul of both relevant exceptions. TikTok v. Trump, 507 F. Supp. 3d 92, 107–09, 112
(D.D.C. 2020). In the TikTok users’ case, the court limited its decision to the informational materials exception.
Marland v. Trump, 498 F. Supp. 3d 624, 636–41 (E.D. Pa. 2020).
62 Executive Order 14034, “Protecting Americans’ Sensitive Data From Foreign Adversaries,” 86 Federal Register
31423, June 9, 2021.
63 Consolidated Appropriations Act, 2023, P.L. 117-328 , div. R, 136 Stat. 4459, 5258 (Dec. 29, 2022); see also 40
U.S.C. §11101(6) (defining “information technology”).
64 OMB, memorandum from Shalanda D. Young, Director of OMB, “‘No TikTok on Government Devices’
Implementation Guidance,” M-23-13, February 27, 2023.
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Members of Congress have also introduced a number of bills that would regulate TikTok. Some
bills would limit the application of the IEEPA exceptions when the President invokes IEEPA to
regulate TikTok.65 For example, the No TikTok on United States Devices Act would direct the
President to exercise his authority under IEEPA to prohibit transactions involving ByteDance’s
property and would provide that the exceptions to IEEPA—which courts relied on to preliminary
enjoin an earlier exercise of IEEPA authority to regulate TikTok66—would not apply to the
exercise of the President’s authority pursuant to the bill.67
Other legislative proposals would create new administrative authorities that could be used to
regulate TikTok. An example is the SAFETY on Social Media Act of 2023.68 That bill would
direct the President to publish a list of “untrustworthy applications and social media entities”69
and would direct the Federal Communications Commission to issue rules that prohibit app stores
and internet service providers from supporting the listed applications.70 Proposals to expand data
privacy frameworks or to create new restrictions on cross-border transfers of data could also
regulate TikTok’s— as well as other entities’—collection, use, and transfer of data.71
On March 13, 2024, the House passed the Protecting Americans from Foreign Adversary
Controlled Applications Act (H.R. 7521), which expressly names TikTok as a “foreign adversary
controlled application” subject to its provisions. 72 H.R. 7521 would prohibit app stores and
internet hosting services from supporting TikTok and other foreign adversary controlled
applications in the United States unless their owners execute a “qualified divestiture.”73
What are the main elements of H.R. 7521, the Protecting Americans from
Foreign Adversary Controlled Applications Act?
H.R. 7521, as passed by the House, would regulate “foreign adversary controlled applications”
and the app stores and internet hosting services through which users access the applications.74 The
bill’s definition of foreign adversary controlled application includes two categories of
applications. First, applications operated by TikTok, ByteDance, or a subsidiary or successor of
either company that is controlled by a foreign adversary qualify as foreign adversary controlled
applications.75 In addition to TikTok and applications operated by TikTok’s parent company,
ByteDance, this definition would capture applications operated by Beijing Douyin Information
Services Co., Ltd., ByteDance’s core operating subsidiary in China in which the Chinese

65 Courts have cited IEEPA’s exceptions when enjoining executive orders that were issued under IEEPA and that
would have applied to TikTok. See supra “What actions did the U.S. government take under International
Emergency Economic Powers Act (IEEPA) authorities?”
66 See supra footnote 61, and “What actions did the U.S. government take under International Emergency
Economic Powers Act (IEEPA) authorities?”
67 H.R. 503, 118th Cong. (2023); S. 85, 118th Cong. (2023).
68 S. 872, 118th Cong. (2023).
69 Section 3 of S. 872.
70 Section 5 of S. 872.
71 See, for example, H.R. 7520, 118th Cong. (2024); S. 1974, 118th Cong. (2023).
72 H.R. 7521, 118th Cong. (2024). The Protecting Americans’ Data from Foreign Adversaries Act of 2024 (H.R. 7520)
also passed the House in March 2024 but does not expressly name TikTok.
73 Section 2(g)(3) of H.R. 7521. For more information about legislative proposals to regulate TikTok, see CRS Legal
Sidebar LSB10942, Restricting TikTok (Part II): Legislative Proposals and Considerations for Congress, coordinated
by Peter J. Benson.
74 Section 2 of H.R. 7521.
75 Section 2(g)(3) of H.R. 7521.
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government holds an equity stake. Second, the President may designate an application as a
foreign adversary controlled application if
(1) the application allows users to share and view text, images, videos, or similar content; has
more than 1,000,000 monthly active users; and meets related definitional requirements;76
(2) the application is operated by a person domiciled in, headquartered in, maintaining a
principal place of business in, or organized under the laws of a “foreign adversary
country,” defined to include the countries listed in 10 U.S.C. §4872(d)(2), or is operated
by a company for which persons owning at least a 20% stake are domiciled in,
headquartered in, maintaining a principal place of business in, or organized under the
laws of a foreign adversary country;77 and
(3) the President determines that the application presents a significant national security
threat.78
Beginning 180 days after an application is designated as a foreign adversary controlled
application,79 H.R. 7521 would prohibit app stores and internet hosting services from enabling the
distribution, maintenance, or updating of the application for U.S. users.80
Before the ban on app stores and internet hosting services supporting the application takes effect,
the owner of a foreign adversary controlled application would be required to provide U.S. users,
upon request, with all data related to their accounts, including posts, photos, and videos, in a
machine readable format.81
App stores and internet hosting services would not be prohibited from enabling the distribution,
maintenance, or updating of TikTok or another foreign adversary controlled application if the
application’s owners execute a “qualified divestiture.”82 H.R. 7521 defines qualified divestiture as
a divestiture or similar transaction for which the President, through an interagency process, has
determined that the application will no longer be controlled by a foreign adversary and will no
longer have any operational relationship with entities controlled by a foreign adversary.83
A qualified divestiture that is completed within 180 days of an application being designated a
foreign adversary controlled application would allow app stores and internet hosting services to
continue distributing, maintaining, and updating the application without interruption.84 Regardless
of when a qualified divestiture takes place, H.R. 7521’s restrictions would cease to apply once a
qualified divestiture had been completed.85

76 If the “primary purpose” of an application “is to allow users to post product reviews, business reviews, or travel
information and reviews,” it does not meet the definitional requirements. Section 2(g)(2)(B) of H.R. 7521.
77 Section 2(g)(1) of H.R. 7521.
78 Section 2(g)(3)(B) of H.R. 7521.
79 For TikTok, this time period would run 180 days from the date H.R. 7521 was enacted. Section 2(a)(2)(A) of H.R.
7521. For an application designated as a foreign adversary controlled application by the President, the 180 days would
run from the date of the President’s determination. Section 2(a)(2)(B) of H.R. 7521.
80 Section 2(a) of H.R. 7521.
81 Section 2(b) of H.R. 7521.
82 Section 2(c) of H.R. 7521.
83 Section 2(g)(6) of H.R. 7521.
84 Section 2(c)(1)(A) of H.R. 7521.
85 Section 2(c)(1)(B) of H.R. 7521. For more information about H.R. 7521, see CRS Legal Sidebar LSB10942,
Restricting TikTok (Part II): Legislative Proposals and Considerations for Congress, coordinated by Peter J. Benson;
and CRS Legal Sidebar LSB11127, H.R. 7521 Regulation of TikTok: Analysis of Selected Legal Issues, by Peter J.
Benson, Valerie C. Brannon, and Joanna R. Lampe.
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Who could be penalized under H.R. 7521 and what penalties could be
imposed?
H.R. 7521, as passed by the House, would provide for civil penalties in two circumstances.86
First, if H.R. 7521 were enacted, an entity that violated the enacted law by providing a
marketplace or internet hosting service that enabled distribution, maintenance, or updates of a
foreign adversary controlled application could be subject to civil penalties of up to $5,000
multiplied by the number of U.S. users who accessed, maintained, or updated the application. 87
Second, if the bill were enacted, an entity that owned or controlled a foreign adversary controlled
application and violated H.R. 7521 by failing to provide machine readable user data in response
to requests from U.S. users could be subject to civil penalties of up to $500 multiplied by the
number of affected users.88
Would H.R. 7521 force any ByteDance or TikTok owners to divest from either
company?
H.R. 7521, as passed by the House. would not directly force ByteDance or TikTok owners to
divest from either company. If H.R. 7521 were to be enacted and ByteDance and TikTok owners
were to elect not to execute a qualified divestiture, that election, in and of itself, would not
constitute a violation of any provision in H.R. 7521. Nor would the election alone subject any
party to the civil penalties provided in the bill. Under H.R. 7521, the primary consequence of a
decision not to divest would be a prohibition on app stores and internet hosting services enabling
access to TikTok in the United States, as opposed to an affirmative requirement to divest under
penalty of legal liability.
The combination of an election not to divest with additional conduct could subject ByteDance,
TikTok, or other entities to civil penalties. If H.R. 7521 were to be enacted, ByteDance and
TikTok owners were to elect not to execute a qualified divestiture, and TikTok were to fail to
properly comply with requests for U.S. user data during the first 180 days after enactment,
TikTok could be subject to civil penalties.89 After those 180 days, an entity that provides a
marketplace for or internet hosting service that enables distribution, maintenance, or updates of
TikTok for U.S. users could be subject to civil penalties.90 However, if TikTok were to properly
comply with all user data requests, and if all app stores and internet hosting services serving U.S.
users were to stop supporting TikTok, no party would be subject to H.R. 7521’s civil penalties
simply because of the lack of divestiture.91
If enacted, how could H.R. 7521 be challenged in court?
If H.R. 7521, as passed by the House, were enacted, there are several ways a challenge to the
enacted law might proceed in federal court. First, to the extent H.R. 7521 would authorize the
Attorney General to enforce the bill through administrative proceedings, an entity that was
subject to such administrative proceedings could file a petition for review of the agency action in

86 Section 2(d)(1) of H.R. 7521.
87 Sections 2(a) and 2(d)(1)(A) of H.R. 7521.
88 Sections 2(b) and 2(d)(1)(B) of H.R. 7521.
89 Ibid.
90 Sections 2(a) and 2(d)(1)(A) of H.R. 7521.
91 Section 2(d)(1) of H.R. 7521.
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the U.S. Court of Appeals for the D.C. Circuit.92 Second, if the Attorney General sued a person or
entity for violating the act, the defendant might raise a constitutional claim as a defense to
liability (which is sometimes called a defensive challenge).93 Third, regulated entities or others
alleging harm under the act could sue to prevent enforcement of the act. This might take the form
of a pre-enforcement challenge (sometimes called an offensive challenge) to the act seeking to
bar the Attorney General from enforcing it.94 Parties seeking to bring pre-enforcement challenges
would need to demonstrate standing to sue, including showing that they faced actual or imminent
harm if the act were enforced.95 H.R. 7521 provides that the D.C. Circuit “shall have exclusive
jurisdiction over any challenge to this Act or any action, finding, or determination under this
Act.”96
What actions have been taken at the state level to regulate TikTok?
A number of states97 have prohibited the installation or use of TikTok on state-owned devices
through executive actions,98 legislative enactments,99 or both.100 Some states have also adopted
broader bans on installing applications or communication technologies provided by entities based
in the PRC on state-owned devices.101
In May 2023, Montana enacted a law, SB 419, that would prohibit TikTok from “operat[ing]
within the territorial jurisdiction of Montana.”102 SB 419 provides that its effective date is January

92 See Section 3(a) of H.R. 7521. As discussed in a CRS Legal Sidebar, it is not clear whether and to what extent H.R.
7521 authorizes administrative enforcement or other agency actions apart from civil suits. See CRS Legal Sidebar
LSB11127, H.R. 7521 Regulation of TikTok: Analysis of Selected Legal Issues, by Peter J. Benson, Valerie C. Brannon,
and Joanna R. Lampe.
93 See, for example, Howard M. Wasserman, “Precedent, Non-Universal Injunctions, and Judicial Departmentalism: A
Model of Constitutional Adjudication,” 23 Lewis & Clark L. Rev. 1077 (2020), pp. 1086–89.
94 See, for example, ibid. at 1086.
95 See CRS, Overview of Standing, Constitution Annotated, https://constitution.congress.gov/browse/essay/artIII-S2-
C1-6-1/ALDE_00012992/ (last visited Mar. 22, 2024); CRS, Actual or Imminent Injury, Constitution Annotated,
https://constitution.congress.gov/browse/essay/artIII-S2-C1-6-4-4/ALDE_00012999/ (last visited Mar. 22, 2024).
96 Section 3(b) of H.R. 7521. For additional analysis of the act’s judicial review provisions, see CRS Legal Sidebar
LSB11127, H.R. 7521 Regulation of TikTok: Analysis of Selected Legal Issues, by Peter J. Benson, Valerie C. Brannon,
and Joanna R. Lampe.
97 See Cailey Gleeson, “These 39 States Already Ban TikTok From Government Devices,” Forbes, March 12, 2024,
available at https://www.forbes.com/sites/caileygleeson/2024/03/12/these-39-states-already-ban-tiktok-from-
government-devices/?sh=342082366705; see also Andrew Adams, “Updated: Where Is TikTok Banned? Tracking
State by State,” Government Technology, December 14, 2022, available at https://www.govtech.com/biz/data/where-is-
tiktok-banned-tracking-the-action-state-by-state.
98 See, for example, State of Arizona, Executive Order 2023-10, April 4, 2023, available at
https://azgovernor.gov/sites/default/files/eo_2023-10_protecting_the_states_cybersecurity_interests.pdf; Shawn Nailor,
Secretary, Vermont Agency of Digital Service and State CIO, Memorandum: Cybersecurity Standard Update 2023-01
(February 16, 2023), available at https://digitalservices.vermont.gov/sites/digitalservices/files/doc_library/
Cybersecurity_Standard_Update_2023-01.pdf.
99 House Bill 3127, 82nd Oregon Legislative Assembly (2023), available at
https://olis.oregonlegislature.gov/liz/2023R1/Downloads/MeasureDocument/HB3127/Enrolled.
100 See Coalition for Independent Technology Research v. Abbott, No. 1:23-cv-783, 2023 WL 8582597, at *1 (W.D.
Tex. Dec. 11, 2023).
101 See Senate Bill 258, Florida Legislature (2023), available at
https://www.flsenate.gov/Session/Bill/2023/258/BillText/er/PDF; State of South Dakota Office of the Governor,
Executive Order 2023-02, January 20, 2023, available at https://governor.sd.gov/doc/EO%202023-02.pdf.
102 Senate Bill 419 §1, 68th Montana Legislature (2023), available at https://leg.mt.gov/bills/2023/billpdf/SB0419.pdf.
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1, 2024,103 but on November 30, 2023, a federal court preliminarily enjoined that effective date.104
As of March 2024, the court’s injunction remains in effect pending a final determination in the
case. The Attorney General of Montana has appealed the preliminary injunction to the U.S. Court
of Appeals for the Ninth Circuit.105
If SB 419 were to take effect, TikTok and mobile app stores could be fined each time a user in
Montana accesses TikTok or is offered the ability to access or download TikTok.106 The law
would become “void” if TikTok were sold to a company that was not, at the time of the sale,
incorporated in a country “designated as a foreign adversary in 15 C.F.R. [§]7.4.”107
Have TikTok or other entities challenged any state actions to regulate TikTok
in court?
TikTok and a group of TikTok users each challenged SB 419, Montana’s ban on TikTok operating
within the state.108 The challengers asked a federal district court to invalidate and enjoin SB 419
on multiple grounds. They argued that the law was preempted by several federal statutes, that it
regulated aspects of national security and foreign affairs that are reserved to the federal
government, and that it violated the Constitution’s First Amendment, the Commerce Clause, the
Bill of Attainder Clause, and the Fourteenth Amendment’s Due Process Clause.109 The court,
finding that TikTok and its users were likely to succeed on some of these arguments, granted a
request to preliminarily enjoin the law from taking effect while the litigation proceeds.110 In the
court’s view, SB 419 likely violates the First Amendment111 and the Commerce Clause,112 and it is
likely preempted under the foreign affairs field preemption doctrine113 and by Section 721 of the
Defense Production Act. 114 The Attorney General of Montana has appealed the ruling to the U.S.
Court of Appeals for the Ninth Circuit.115
In addition, an organization of academics, journalists, researchers, and scientists filed a lawsuit
challenging Texas’s prohibition against using TikTok on government-issued devices.116 The
organization argued that the ban, as applied to faculty at public universities, violated its members’

103 Ibid. §5.
104 Alario v. Knudsen, Nos. CV 23-56-M-DWM & CV 23-61-M-DWM, 2023 WL 8270811, at *18 (D. Mont. Nov. 30,
2023), appeal filed, No. 24-34 (9th Cir. Jan. 3, 2024).
105 See Notice of Preliminary Injunction Appeal, TikTok v. Knudsen, No. 9:23-cv-61 (D. Mont. Jan. 2, 2024).
106 Senate Bill 419 §1, 68th Montana Legislature (2023), available at https://leg.mt.gov/bills/2023/billpdf/SB0419.pdf.
107 Ibid. §4. For more information about Montana’s SB 419, see CRS Legal Sidebar LSB10972, Montana’s TikTok
Ban, an Injunction, and Pending Legal Actions, by Sanchitha Jayaram and Madeline W. Donley.
108 Alario, 2023 WL 8270811, at *18.
109 Complaint ¶¶85–138, TikTok v. Knudsen, No. 9:23-cv-61 (D. Mont. May 22, 2023).
110 Alario, 2023 WL 8270811, at *18.
111 Alario, 2023 WL 8270811, at *12.
112 Ibid. at *17.
113 For more information about the doctrine of foreign affairs preemption, see CRS Legal Sidebar WSLG1836,
Constitutional Limits on States’ Efforts to “Uphold” the Paris Agreement, by Steve P. Mulligan.
114 Alario, 2023 WL 8270811, at *15. Section 721 of the Defense Production Act is codified at 50 U.S.C. §4565.
115 See Notice of Preliminary Injunction Appeal, TikTok v. Knudsen, No. 9:23-cv-61 (D. Mont. Jan. 2, 2024). For more
information about the federal district court’s preliminary injunction of Montana’s law, see CRS Legal Sidebar
LSB10972, Montana’s TikTok Ban, an Injunction, and Pending Legal Actions, by Sanchitha Jayaram and Madeline W.
Donley.
116 Coalition for Independent Technology Research v. Abbott, No. 1:23-cv-783, 2023 WL 8582597, at *1–2 (W.D. Tex.
Dec. 11, 2023).
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First Amendment rights.117 In this case, the court disagreed with the challengers’ arguments. The
court held that, because Texas’s ban reaches only “state-owned and -managed devices,” the
regulation was subject to a lower level of First Amendment scrutiny, which it satisfied.118 The
court dismissed the case.119
Are foreign governments regulating TikTok?
The European Union (EU) has undertaken regulation of TikTok as part of its effort to regulate the
digital economy, and some countries have restricted, blocked, or banned the app. Countries have
banned TikTok on government devices (e.g., Australia, Canada, the United Kingdom) or
temporarily blocked or banned TikTok due to concerns about content (e.g., Indonesia) or during
times of political unrest (e.g., Pakistan).120 Some countries have banned the app outright,
including India, which banned TikTok in 2020 and currently has a ban on 509 apps developed in
China.121 Nepal, Afghanistan, and Somalia have also banned TikTok due to concerns about the
content being posted on the platform.122
Implications of a Potential Ban or Divestiture of
TikTok
How might a divestiture of TikTok work?
Some options ByteDance might consider if it chooses to divest TikTok could include the
following:
• Some of the investors of ByteDance might create a new company to operate
TikTok.123

117 Ibid. at *2.
118 Ibid. at *7–9. The court held that Texas’s ban was a “a restriction on a nonpublic forum.” Ibid. at *7. For more
information about the First Amendment standards applicable in public and nonpublic forums, see CRS Legal Sidebar
LSB10383, Religious Speech and Advertising: Current Circuit Split and its Implications for Congress, by Whitney K.
Novak, and CRS Legal Sidebar LSB10151, From Clamor to Calm: Restrictions on Speech at Polling Places, by
Valerie C. Brannon,.
119 Coalition for Independent Technology Research, 2023 WL 8582597, at *9. The following sections of this Report
address the First Amendment and other constitutional considerations that could potentially be raised by regulations of
TikTok: “What First Amendment considerations might be raised by government regulation of TikTok?”; “How
might the Bill of Attainder Clause apply to legislation that names TikTok?”; and “What Takings Clause
considerations might be raised by future legislation that regulates TikTok?,” and “What Due Process
considerations might be raised by government regulation of TikTok?” For more information about legal
considerations potentially raised by regulations of TikTok, see CRS Legal Sidebar LSB10942, Restricting TikTok (Part
II): Legislative Proposals and Considerations for Congress, coordinated by Peter J. Benson; and CRS Legal Sidebar
LSB11127, H.R. 7521 Regulation of TikTok: Analysis of Selected Legal Issues, by Peter J. Benson, Valerie C. Brannon,
and Joanna R. Lampe.
120 Jennifer Hassan et. al, “The U.S. could ban TikTok. These countries have blocked or restricted it,” Washington Post,
March 13, 2024.
121 Reuters, “India adds 54 more Chinese apps to ban list; Sea says it complies with laws,” February 15, 2022.
122 Ibid; Alex Travelli and Suhasini Raj, “What Happened When India Pulled the Plug on TikTok,” New York Times,
March 22, 2024; Bashir Mohamed Caato, “Outcry in Somalia over government decision to ban TikTok,” Al Jazeera,
August 26, 2023; “Afghanistan: Taliban orders TikTok, PUBG ban for ‘misleading’ youths,” BBC, April 22, 2022;
“Nepal bans TikTok and says it disrupts social harmony,” Associated Press, November 13, 2023.
123 For more information on investors of ByteDance, see “Where Is ByteDance Based?”
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• ByteDance might sell TikTok to a third-party, such as a group of investors or a
company.
The PRC government might not allow either of these options to occur.124 Under H.R. 7521, as
passed by the House, these two options would need to meet the requirements of a “qualified
divestiture,” which requires that the app not be controlled by, and have no operational relationship
with, a foreign adversary.125
Are there potential buyers for TikTok if it was for sale?
The parties interested in purchasing TikTok would likely depend on the sales price and the
components of TikTok that would be included in the sale. ByteDance might sell TikTok for
billions of dollars, which would likely limit the potential buyers. TikTok has a large number of
U.S. users and has been expanding the services offered to U.S. users on the app.126 The amount a
buyer is willing to pay might be lower if, for example, the sale of TikTok does not include its
algorithms or the data it has collected on its U.S. and other users. Although ByteDance was
reportedly valued at $268 billion in December 2023,127 the current value of the U.S. portion of
TikTok is unknown; some investors reportedly estimate that TikTok has been operating at a
loss.128
Other factors might also limit the potential buyers of TikTok. For example, proposals to purchase
TikTok from large technology companies—such as Apple, Google, and Meta—might raise
antitrust concerns. After the House passed H.R. 7521, several individuals and companies
reportedly expressed interest in purchasing TikTok.129
How would a prohibition on entities facilitating the provision or the sale of
TikTok affect other social media platforms?
If entities were prohibited from facilitating the provision of TikTok to U.S. users, some U.S users
might start to use or spend more time on other social media platforms. In particular, U.S. users
might increase use of social media platforms that offer short-form videos similar to TikTok, such
as Meta’s Instagram Reels and Google’s YouTube Shorts, as well as other social media platforms

124 For more information on PRC’s response to a potential sale of TikTok, see “Does the PRC Government Exercise
Control Over ByteDance?”
125 For more information on the requirements of H.R. 7521, see “What are the Main Elements of H.R. 7521?”
126 For example, TikTok Shop in the United States started in September 2023 (see TikTok, “Introducing TikTok Shop,”
September 12, 2023, available at https://newsroom.tiktok.com/en-us/introducing-tiktok-shop). For more information on
the number of U.S. TikTok users, see “How Many Users Does TikTok Have?”
127 Zheping Huang and Jane Zhang, “ByteDance Offers Investors a Buyback at $268 Billion Valuation,” Bloomberg,
December 6, 2023, available at https://www.bloomberg.com/news/articles/2023-12-06/bytedance-offers-to-buy-back-5-
billion-worth-of-shares-scmp.
128 Jing Yang, Kate Clark, and Erin Woo, “TikTok Ban Bill Spotlights Open Secret: App Loses Money,” The
Information, March 13, 2024, available at https://www.theinformation.com/articles/tiktok-ban-bill-spotlights-open-
secret-app-loses-money.
129 For example, parties that have expressed interest in purchasing TikTok include former Treasury Secretary Steven
Mnuchin, Bobby Kotick (former CEO of Activision, a video game publisher), Kevin O’Leary (an investor in the
television show Shark Tank), and Rumble (an online video platform). See Rachel Louise Ensign and Gareth Viperz,
“Steven Mnuchin Says He Is Putting Together a Group to Buy TikTok,” Wall Street Journal, updated March 14, 2024,
available at https://www.wsj.com/tech/steven-mnuchin-says-he-is-putting-together-a-group-to-buy-tiktok-3aac4a33;
and Daysia Tolentino, “Who Could Buy TikTok? These Are the People Who Could Acquire the App,” NBC News,
March 14, 2024, available at https://www.nbcnews.com/tech/social-media/tiktok-ban-sale-buy-bill-law-download-app-
senate-date-rcna143413.
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such as Snapchat, X (formerly Twitter), or Reddit. A ban might also provide the opportunity for
new social media platforms to emerge to serve the U.S. market, although a new platform might
face difficulty competing with existing social media platforms.130
If TikTok were sold, the effect on other social media platforms would depend on the actions taken
by the entity that purchased TikTok. For example, if the entity were to stop offering certain
services or implements changes that some users do not like, the users might start using or
spending more time on other social media platforms. Alternatively, if the entity were to make
improvements to TikTok, individuals might spend more time on TikTok and less time on, or stop
using, other social media platforms.
Which online service providers would be affected by prohibiting the
distribution, maintenance, or updating of TikTok in the United States?
Section 2 of H.R. 7521, as passed by the House, would prohibit any entity from distributing,
maintaining, or updating (or enabling these services of) TikTok or foreign adversary controlled
applications “within the land or maritime borders of the United States,” starting 180 days after the
enactment of the law.131 Any entity that violates Section 2 would be subject to a civil penalty in
an amount to be determined by the number of U.S. users that “have accessed, maintained, or
updated” the TikTok or covered application using services provided by that entity.132 The
Attorney General would “conduct investigations related to potential violations” and pursue
enforcement against determined violations.133
While the bill does not define “entity” under Section 2, the term could include at least the
following two types of online service providers:
• An online marketplace that allows internet users to find, download, install, or
update a software application. The example provided in the bill is an “online
mobile application store.”134 In the United States, the TikTok mobile app is
mostly distributed through app stores operated by major mobile platform
developers such as Apple Inc. (accessible through its iOS platform) and Google
LLC (through its Android platform). TikTok is also available through third-party
app stores, including those operated by Amazon.com, Inc. and Samsung
Electronics Co., Ltd. To comply with Section 2 of the bill, these app stores would
either have to remove TikTok from its offerings or make the app unavailable to
U.S. users.135
• An internet hosting service vendor that provides data storage and computing
resources “for the accommodation and maintenance” of TikTok’s content and
services.136 The bill includes hosting services such as “file hosting, domain name

130 For example, social media platforms benefit from network effects, where the perceived value of an online platform
as the number of active users grows, which can make it difficult for a nascent platform to compete with incumbents.
For more information about network effects and other characteristics of online platforms, see CRS Report R47662,
Defining and Regulating Online Platforms, coordinated by Clare Y. Cho.
131 Section 2(a), (g)(3)(A) of H.R. 7521.
132 Section 2(d)(1) of H.R. 7521.
133 Section 2(d)(2)(A) of H.R. 7521.
134 Section 2(a)(1)(A) of H.R. 7521.
135 Ibid.
136 Section 2(g)(5) of H.R. 7521.
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server hosting, cloud hosting, and virtual private server hosting.”137 According to
a network traffic analysis, TikTok may have used hosting service provided by at
least 10 vendors, including U.S.-based cloud service providers Amazon Web
Services (AWS), Google Cloud Platform, and Oracle Cloud.138
In September 2020, the Oracle Corporation announced that it had become
TikTok’s “secure cloud technology provider” to deploy, scale, and operate
TikTok systems in the Oracle Cloud.139 TikTok claims that it has “created a stand-
alone version of the TikTok platform for the United States that is isolated inside
servers in Oracle’s U.S. cloud environment but can communicate with the global
TikTok service in controlled and monitored ways.”140
To comply with Section 2 of the bill, an internet hosting service vendor would
have to either stop hosting TikTok’s content and services or disable “the
distribution, maintenance, or updating of” TikTok for U.S. users.141
Additionally, upon request, “the entity that owns or controls” TikTok would be required to
provide “all the available data related to” a U.S. user’s account (including posts, photos, and
videos) to the requesting user before the user lost access to the app.142 Such data would be
intended to enable the user to transfer the content to “alternative applications.”143
Would U.S. users still be able to access TikTok content under the current
language in H.R. 7521 prohibiting the distribution, maintenance, or updating
of TikTok in the United States?
H.R. 7521, as passed by the House, does not specifically address the topic of users within the land
or maritime borders of the United States or U.S. citizens outside those borders accessing TikTok
content or using its services after potential enactment of the bill. It also does not address users
within the United States bypassing geographic restrictions to access non-U.S. instances of
TikTok. For example, a user physically located in the United States could potentially access non-
U.S. instances of TikTok or app stores by appearing to be located outside the United States using
a Virtual Private Network (VPN) or other services that allow IP address masking.144

137 Ibid.
138 “TikTok Application,” Netify.ai, available at https://www.netify.ai/resources/applications/tiktok, accessed March
2024.
139 Oracle Corporation, “Oracle Chosen as TikTok’s Secure Cloud Provider,” press release, September 19, 2020,
available at https://www.oracle.com/news/announcement/oracle-chosen-as-tiktok-secure-cloud-provider-091920/.
140 “TikTok’s Commitment to U.S. National Security,” TikTok, available at https://usds.tiktok.com/usds-about/,
accessed March 2024.
141 Section 2(a)(1)(B) of H.R. 7521.
142 Section 2(b) of H.R. 7521.
143 Ibid.
144 A VPN is “a virtual network built on top of existing networks that can provide a secure communications mechanism
for data and IP information transmitted between networks.” National Institute of Standards and Technology, U.S.
Department of Commerce, Computer Security Resource Center (CSRC) Glossary: Virtual Private Network (VPN),
available at https://csrc.nist.gov/glossary/term/virtual_private_network. See also Aliza Vigderman and Gabe Turner,
“How to Hide IP Addresses,” Security.org, January 16, 2024, available at https://www.security.org/vpn/hide-your-ip-
address/.
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What First Amendment considerations might be raised by government
regulation of TikTok?
Laws regulating a medium of expression, such as a newspaper or other platform for speech, can
trigger First Amendment scrutiny, meaning that if subject to a legal challenge, a court might
review the law for compliance with the First Amendment.145 Federal and state restrictions on
TikTok have been subject to legal challenges alleging the restrictions violate the First
Amendment’s Free Speech Clause. One trial court held a Montana restriction on TikTok was
likely unconstitutional, as discussed above.146 Another trial court similarly issued a preliminary
ruling on First Amendment grounds, preventing the federal government from enforcing an
executive order restricting transactions related to WeChat.147
One relevant issue in a First Amendment challenge is the type of free speech interest being
asserted. While foreign corporations outside of a U.S. territory may not be able to claim First
Amendment protections, separately incorporated organizations within the United States may raise
First Amendment claims.148 In prior legal challenges, both TikTok and the platform’s U.S. users
have asserted First Amendment claims. U.S. users may have an interest both in receiving speech
from abroad149 as well as in purely domestic exchanges.
Generally, if a law burdens expressive activity, the level of constitutional scrutiny that a court
applies depends in large part on the type of expression being regulated and how the law
operates.150 Laws that regulate speech based on its content usually trigger an analysis known as
strict scrutiny, under which a law is presumptively unconstitutional and valid only if it is the least
restrictive means to serve a compelling government interest.151 Thus, if a law targeted TikTok or
other speech platforms because of the speech they host, or targets certain speech on those
platforms, it could trigger strict scrutiny and would be more likely to be held unconstitutional.152
In contrast, if a law did not target TikTok or another platform because of its speech and did not
otherwise discriminate between particular viewpoints or types of content, it might be subject to
review under intermediate scrutiny.153 Intermediate scrutiny requires the government to show the
law advances an “important or substantial” government interest unrelated to the suppression of
speech and is “no greater than is essential” to further this interest.154 Under some formulations of
intermediate scrutiny, the government must also show that the law leaves open “ample alternative

145 U.S. Const. amend. I (“Congress shall make no law . . . abridging the freedom of speech.”); see, for example, Arcara
v. Cloud Books, Inc., 478 U.S. 697, 705–07 (1986) (explaining that while government regulation of conduct with “no
element of protected expression” does not trigger First Amendment scrutiny, constitutional scrutiny is triggered by
government action that targets “conduct with a significant expressive element” or “where a statute based on a
nonexpressive activity has the inevitable effect of singling out those engaged in expressive activity”).
146 See supra “Have TikTok or other entities challenged any state actions to regulate TikTok in court?”; Alario v.
Knudsen, Nos. CV 23-56-M-DWM & CV 23-61-M-DWM, 2023 WL 8270811, at *5 (D. Mont. Nov. 30, 2023), appeal
filed, No. 24-34 (9th Cir. Jan. 3, 2024). For further discussion of the Alario case, see CRS Legal Sidebar LSB10972,
Montana’s TikTok Ban, an Injunction, and Pending Legal Actions, by Sanchitha Jayaram and Madeline W. Donley.
147 U.S. WeChat Users Alliance v. Trump, 488 F. Supp. 3d 912, 917 (N.D. Cal. 2020).
148 Agency for Int’l Dev. v. All. for Open Soc’y Int’l, Inc., 140 S. Ct. 2082, 2086–87 (2020).
149 See, for example, Lamont v. Postmaster General, 381 U.S. 301, 305 (1965).
150 See generally, for example, CRS Report R47986, Freedom of Speech: An Overview, by Victoria L. Killion.
151 Reed v. Town of Gilbert, 576 U.S. 155, 163 (2015); CRS In Focus IF12308, Free Speech: When and Why Content-
Based Laws Are Presumptively Unconstitutional, by Victoria L. Killion.
152 See, for example, Arkansas Writers’ Project, Inc. v. Ragland, 481 U.S. 221, 229, 231 (1987).
153 For example, Turner Broad. Sys. v. FCC, 512 U.S. 622, 661–62 (1994).
154 Turner Broad. Sys., 512 U.S. at 662.
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channels for communication of the information.”155 Intermediate scrutiny is easier to satisfy than
strict scrutiny but is still relatively robust: the trial court rulings referenced above concluded that
the federal and state governments had likely failed to satisfy intermediate scrutiny.156
How might the Bill of Attainder Clause apply to legislation that names
TikTok?
Article I, Section 9, Clause 3 of the Constitution prohibits Congress from enacting bills of
attainder—legislation that imposes punishment on an identifiable person or group without trial.157
Because some recent legislative proposals identify TikTok or ByteDance by name, questions have
arisen as to whether such proposals may be unconstitutional bills of attainder.158
Courts analyzing bill of attainder challenges consider three questions. First, does the challenged
bill apply with specificity? Second, does it impose punishment? Third, does it do so without a
judicial trial? If all three factors are met, a court must strike down the legislation as a bill of
attainder.159
With respect to the first question, if a bill applies to a named individual or entity, courts are likely
to hold that the specificity requirement is satisfied.160 Historical bill of attainder cases involved
legislation that targeted individuals or identifiable groups of people.161 Although the Supreme
Court has not considered whether the Bill of Attainder Clause also protects corporations such as
TikTok and ByteDance, federal appeals courts considering bill of attainder challenges brought by
corporations have either held that the clause protects corporations162 or assumed that it does.163
Identifying TikTok or ByteDance by name in legislation may meet the specificity requirement.
The second question, whether a bill imposes punishment, is the most complex. Courts apply three
tests for assessing whether a law imposes punishment, known as the historical, functional, and
motivational tests.164 The historical test deems a law to be punitive if it is one of a limited set of

155 Clark v. Cmty. for Creative Non-Violence, 468 U.S. 288, 293 (1984).
156 U.S. WeChat Users Alliance v. Trump, 488 F. Supp. 3d 912, 927–28 (N.D. Cal. 2020); Alario v. Knudsen, Nos. CV
23-56-M-DWM & CV 23-61-M-DWM, 2023 WL 8270811, at *8 (D. Mont. Nov. 30, 2023), appeal filed, No. 24-34
(9th Cir. Jan. 3, 2024). For a more in-depth discussion of possible First Amendment limitations on the federal
government’s ability to regulate TikTok, see CRS Legal Sidebar LSB10942, Restricting TikTok (Part II): Legislative
Proposals and Considerations for Congress, coordinated by Peter J. Benson; and CRS Legal Sidebar LSB11127, H.R.
7521 Regulation of TikTok: Analysis of Selected Legal Issues, by Peter J. Benson, Valerie C. Brannon, and Joanna R.
Lampe.
157 Nixon v. Administrator of General Services, 433 U.S. 425, 468 (1977). A related provision prohibits state bills of
attainder. U.S. Const. art. I, §10, cl. 1.
158 With respect to H.R. 7521 specifically, a CRS Legal Sidebar discusses why courts may be unlikely to strike down
that legislation as a bill of attainder. See CRS Legal Sidebar LSB11127, H.R. 7521 Regulation of TikTok: Analysis of
Selected Legal Issues, by Peter J. Benson, Valerie C. Brannon, and Joanna R. Lampe.
159 Nixon, 433 U.S. at 470–73.
160 See, for example, ibid. at 471–72 (acknowledging the challenged act’s “specificity—the fact that it refers to
appellant by name”).
161 See, for example, ibid. at 473–75; see also United States v. Lovett, 328 U. S. 303 (1946) (barring certain named
individuals from drawing federal salaries); United States v. Brown, 381 U. S. 437 (1965) (prohibiting Communists
from serving as labor union officers); Ex parte Garland, 4 Wall. 333 (1867) (barring former Confederate sympathizers
from holding certain jobs); Cummings v. Missouri, 4 Wall. 277 (1867) (same).
162 For example, Consolidated Edison Co. of N.Y., Inc. v. Pataki, 292 F.3d 338, 349 (2d Cir. 2002).
163 For example, Kaspersky Lab, Inc. v. U.S. Dept. of Homeland Sec., 909 F.3d 446, 543–54 (D.C. Cir. 2018); SBC
Communications, Inc. v. FCC, 154 F.3d 226, 234 (5th Cir. 1998).
164 Nixon, 433 U.S. at 473–83.
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legislative actions that were held to be bills of attainder from before the Founding of the United
States through the mid-20th century, including banishment, imprisonment, confiscation of
property, or employment bans.165 The functional test is generally given the most weight of the
three tests and considers “whether the law under challenge, viewed in terms of the type and
severity of burdens imposed, reasonably can be said to further nonpunitive legislative
purposes.”166 The third test for punishment considers whether the legislature that enacted a
challenged law was motivated by an intent to punish the targeted entity.167 The question of
whether a bill imposes punishment is highly fact-dependent. A court reviewing legislation naming
TikTok would assess the provisions aimed at TikTok under these three tests to determine whether
the law was punishing TikTok. As a general matter, review of whether legislation is punitive for
purposes of the Bill of Attainder Clause is deferential, and federal courts rarely strike down laws
as bills of attainder.168
With respect to the third question, if a bill provides for a judicial trial before imposing sanctions,
it falls outside the prohibition on bills of attainder.169 Thus, a bill that imposed legal consequences
on TikTok or another entity only after a trial likely would not be struck down as a bill of
attainder.170
What Takings Clause considerations might be raised by future legislation that
regulates TikTok?
The Fifth Amendment’s Takings Clause prohibits the United States from taking private property
without just compensation.171 The Takings Clause’s protections apply to U.S. persons and to
foreign individuals and entities with substantial connections to the United States, including those
whose property in the United States is taken by the federal government.172
The Supreme Court has distinguished between two types of takings: physical takings and
regulatory takings.173 Physical takings are the “paradigmatic” example of a taking and occur

165 Ibid. at 473–75.
166 Ibid. at 475–76; see also Kaspersky Lab, 909 F.3d at 455.
167 Nixon, 433 U.S. at 478.
168 For additional discussion of bill of attainder doctrine, see CRS., Bills of Attainder Doctrine, Constitution Annotated,
available at https://constitution.congress.gov/browse/essay/artI-S9-C3-2/ALDE_00013187/ (last visited Mar. 21, 2024).
169 See, for example, Nixon, 433 U.S. at 538–39 (“Under our cases, therefore, bills of attainder require two elements:
first, a specific designation of persons or groups as subjects of the legislation, and, second, a[n] . . . arbitrary
deprivation . . . without notice, trial, or other hearing.”).
170 Some federal appeals courts have held or assumed that the Bill of Attainder Clause does not apply to actions of the
executive branch. See Paradissiotis v. Rubin, 171 F.3d 983, 988 (5th Cir. 1999) and cases cited. The Supreme Court has
not considered this question, and the facts in prior cases differ from agency enforcement against TikTok that might be
authorized under existing legislative proposals. However, the limited available authority suggests that legislation
imposing legal consequences only after discretionary agency action may not be struck down as a bill of attainder.
171 Ibid.; Lingle v. Chevron U.S.A., Inc., 544 U.S. 528, 536 (2005).
172 For example, Atamirzayeva v. United States, 77 Fed. Cl. 378, 385 (Fed. Cl. 2007) (“Regarding the Takings Clause
of the Fifth Amendment, nonresident aliens may invoke the Takings Clause to seek remuneration for the expropriation
of their property located within the United States. . . . However, the precise issue regarding whether a nonresident alien
must demonstrate a substantial connection with the United States to have standing to invoke the Takings Clause
regarding property outside the United States remains unsettled . . . .”) (citing Russian Volunteer Fleet v. United States,
282 U.S. 481, 491–92 (1931)).
173 See Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302, 321 (2002) (“The
text of the Fifth Amendment itself provides a basis for drawing a distinction between physical takings and regulatory
takings.”).
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when the government directly appropriates or physically invades private property.174 Regulatory
takings involve a government acting in its “regulatory capacity”175 and are typically analyzed
under the framework created by the Supreme Court in Penn Central Transportation Company v.
New York City.176 Under the Penn Central framework, courts consider the following three factors
to determine if there is a regulatory taking: (1) “[t]he economic impact of the regulation on the
claimant,” (2) “the extent to which the regulation has interfered with distinct investment-backed
expectations,” and (3) “the character of the government action,” such as whether it is akin to a
physical invasion or whether it is “adjusting the benefits and burdens of economic life to promote
the common good.”177
TikTok might challenge future legislation as a violation of the Takings Clause if it believes the
law’s restrictions have a severe economic impact on its business and interferes with its investors’
expectations.178 Such a challenge would likely be analyzed under the Penn Central factors.179
This analysis is inherently fact-specific and could depend, for example, on the extent of the
legislation’s economic impact and the reasonableness of ByteDance’s expectations when it
invested in musical.ly.180 As a general matter, any national security arguments invoked by the
government could make it difficult for a Takings Clause challenge to succeed. Courts have
observed that national security is a paramount governmental interest, and courts have said that
valid regulatory actions serving substantial national security interests weigh against a
determination that a compensable taking has occurred.181
What Due Process considerations might be raised by government regulation of
TikTok?
Under the Fifth Amendment’s Due Process Clause, the federal government may not deprive any
person of a protected property interest unless it provides them with notice of the deprivation and
an opportunity to be heard before a neutral party.182 As with the Taking Clause, the Due Process

174 Lingle, 544 U.S. at 537 (“The paradigmatic taking requiring just compensation is a direct government appropriation
or physical invasion of private property.”).
175 Buffalo Teachers Federation v. Tobe, 464 F.3d 362, 374 (2d Cir. 2006).
176 438 U.S. 104 (1978).
177 Ibid. at 124.
178 In 2020, ByteDance and TikTok raised arguments under the Takings Clause in a challenge to a Presidential Order
that had been issued under CFIUS authorities. See Petition for Review, TikTok v. CFIUS, No. 20-1444 (D.C. Cir. Nov.
10, 2020). Those arguments have not been ruled on by a court. See supra “What actions followed the 2019
Committee on Foreign Investment in the United States (CFIUS) investigation of the ByteDance acquisition of
musical.ly?”
179 Tahoe-Sierra, 535 U.S. at 330 (“Anything less than a ‘complete elimination of value,’ or a ‘total loss’ . . . would
require the kind of analysis applied in Penn Central.”) (quoting Lucas v. South Carolina Costal Council, 505 U.S.
1003, 1019–20, n.8 (1992)).
180 See A&D Auto Sales, Inc. v. United States, 748 F.3d 1142, 1159 (Fed. Cir. 2014) (“Assessing the reasonableness of
a plaintiff’s [distinct investment-backed] expectations ‘is an objective, but fact-specific inquiry into what, under all the
circumstances, the [plaintiff] should have anticipated.’” (quoting Cienega Gardens v. United States, 331 F.3d 1319,
1346 (Fed. Cir. 2003))).
181 Haig v. Agee, 453 U.S. 280, 307 (1981) (“It is obvious and unarguable that no governmental interest is more
compelling than the security of the Nation.”); Paradissiotis v. United States, 304 F.3d 1271, 1275 (Fed. Cir. 2002)
(“Valid regulatory measures taken to serve substantial national security interests may adversely affect individual
contract-based interests and expectations, but those effects have not been recognized as compensable takings for Fifth
Amendment purposes.”).
182 Kerry v. Din, 576 U.S. 86, 111 (2015) (Breyer, J., dissenting) (“Due Process Clause procedures . . . normally
include notice of an adverse action, an opportunity to present relevant proofs and arguments, before a neutral
decisionmaker, and reasoned decisionmaking.”); Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 542 (1985) (“An
(continued...)
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Clause’s protections apply to U.S. persons and to foreign persons or entities that have “developed
substantial connections” with the United States through presence or property.183 The Due Process
Clause is primarily applied to actions taken by the executive branch; for legislative
determinations, the Supreme Court has said that the legislative process may provide “all the
process that is due”184 unless the law is “palpably arbitrary.”185
Beyond the core requirement of notice and an opportunity for a hearing, the Due Process Clause’s
procedural requirements are flexible and may vary depending on the particular situation.186 To
determine what procedures are required in any given case, courts apply a three-factor balancing
test that the Supreme Court articulated in Mathews v. Eldridge.187 Under this test, the reviewing
court must weigh: (1) the private interests affected by the determination; (2) the risk of erroneous
deprivation of such interests through the procedures the government used and the probable value,
if any, of additional or substitute procedures; and (3) the government’s interest at stake.188
The application of this test can lead to different requirements in different circumstances. For
example, the U.S. Court of Appeals for the D.C. Circuit has held that, before the President can
order a company to divest an acquisition under the CFIUS process, the government must first
provide the affected company with notice of the determination and an opportunity to rebut the
evidence supporting it.189 On the other hand, when the government has added persons to sanctions
lists without prior notice, courts have concluded that the government’s interest in preventing
“asset flight” outweighs litigants’ need for a pre-deprivation hearing.190
Courts have found it problematic when a party is unable to examine and challenge the evidence
on which a determination is based.191 However, when a determination is based on classified
information, courts have recognized that forcing the executive branch to disclose such
information would “compel a breach in the security which that branch is charged to protect.”192 In
some cases, courts have deemed it sufficient for the government to provide unclassified
summaries of the evidence or have required the government to submit the classified information
in camera for the court’s review (i.e., permitting only the court to view it).193

essential principle of due process is that a deprivation of life, liberty, or property be preceded by notice and opportunity
for hearing appropriate to the nature of the case.”) (internal quotation marks and citation omitted).
183 See National Council of Resistance of Iran v. Department of State, 251 F.3d 192, 203 (D.C. Cir. 2001) (holding that
a foreign entity, which had been designated by the State Department as a foreign terrorist organization, was entitled to
due process protections because it “entered the territory of the United States and established substantial connections
with this country”).
184 Atkins v. Parker, 472 U.S. 115, 116 (1985).
185 Kansas City Southern Ry. Co. v. Road Imp. Dist. No. 3 of Sevier County, Ark., 266 U.S. 379, 386 (1924).
186 Morrissey v. Brewer, 408 U.S. 471, 481 (1972).
187 424 U.S. 319, 334 (1976).
188 Nelson v. Colorado, 581 U.S. 128, 135 (2017); Mathews, 424 U.S. at 335.
189 Ralls Corp. v. CFIUS, 758 F.3d 296, 319–21 (D.C. Cir. 2014).
190 For example, Al Haramain Islamic Foundation, Inc., v. U.S. Dep’t of Treasury, 686 F.3d 965, 985 (9th Cir. 2012)
(“As the district court noted, and as many courts have held, the potential for ‘asset flight’ almost certainly justifies [the
Office of Foreign Asset Control’s] decision not to provide notice before freezing the assets.”).
191 Ralls Corp., 758 F.3d at 318 (“Both the Supreme court and this Court have recognized that the right to know the
factual basis for the action and the opportunity to rebut the evidence supporting the action are essential components of
due process.”).
192 Fares v. Smith, 901 F.3d 315, 324 (D.C. Cir. 2019).
193 See ibid. at 322–24 (discussing cases where courts have required in camera review of classified evidence or have
found sufficient unclassified summaries in lieu of classified evidence).
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Should Congress consider potential TikTok-related legislation, Due Process Clause analysis
would be particularly relevant if the legislation provided for executive branch determinations. To
comply with the Due Process Clause, any executive branch decision implicating TikTok or
ByteDance’s property rights would likely need to provide, at a minimum, notice of the
determination, ability to examine any unclassified evidence on which the decision was based, and
an opportunity to rebut that evidence.
What is Project Texas?
Formally announced by TikTok in January 2023, Project Texas is a program currently being
implemented by TikTok to address what it claims are the key national security concerns expressed
by the U.S. government during the company’s negotiations with the U.S. Department of Justice
following the 2019 CFIUS investigation (see What was the result of the 2019 CFIUS
Investigation of ByteDance?).194 The Department of Justice and CFIUS have declined to
comment on the U.S. government’s view of Project Texas, citing confidentiality obligations.
The core element of Project Texas, according to TikTok, is a localization of all data generated by
U.S. users and monitoring of cross-border data flows by a team based in the United States.
TikTok plans to do this through the establishment of a new subsidiary, TikTok U.S. Data Security
(USDS), based in the United States, which would be monitored by Oracle. USDS would also
manage the migration of all TikTok data traffic to Oracle Cloud, and, according to TikTok, would
establish a dedicated “transparency center” to allow Oracle employees to inspect TikTok’s source
code.195 As of August 2023, media reporting indicates that access to TikTok’s source code is a
point of contention between Oracle and TikTok employees, and that TikTok is imposing access
restrictions and surveillance requirements on Oracle employees that impedes their ability to
implement Project Texas.196 Several experts and Members of Congress contend that even if
Project Texas were to be fully implemented, it does not address the core problem of ByteDance
employee access to U.S. user data, which some experts argue could be maintained despite a
localization of data in the United States depending on how ByteDance and TikTok structure
internal data security protocols and access permissions.197
Could a ban, divestiture, sale or other efforts to regulate TikTok have broader
policy implications for digital trade?
Until 2023, the United States promoted the free flow of data across borders and opposed
data localization requirements in its free trade agreements.198 These policies were
included as negotiating objectives in trade agreements beginning with the passage of the
most recent Trade Promotion Authority in 2015 (TPA-2015, P.L. 114-26). In fall 2023,
the Office of the United States Trade Representative (USTR) withdrew its support for
proposals at the World Trade Organization (WTO) that supported open cross-border data
flows and opposed data localization. USTR also suspended digital trade talks in the Indo-

194 Matt Perault and Samm Sacks, “Project Texas: The Details of TikTok’s Plan to Remain Operational in the United
States,” January 26, 2023.
195 TikTok, “When will Project Texas be fully operational?” press release, March 23, 2023.
196 Emily Baker-White, “As TikTok Ban Looms, ByteDance Battles Oracle For Control Of Its Algorithm,” Forbes,
August 24, 2023; Anissa Gardizy, “TikTok Says U.S. Survival Plan is Going Forward. Its Cloud Provider Isn’t So
Sure,” The Information, May 22, 2023.
197 Matt Perault, “What Happened to TikTok’s Project Texas?” Lawfare, March 20, 2024.
198 Data localization policies require that data generated within a country be stored and processed on servers within that
country. For more information on issues related to cross-border data flows and digital trade policy, see CRS In Focus
IF12347, Digital Trade and Data Policy: Select Key Issues, by Danielle M. Trachtenberg.
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Pacific Economic Framework for Prosperity. USTR Katherine Tai attributed the decision
to the need for domestic policy “space” on digital economy issues given rapid
technological advancement and shifting domestic conversations on regulation of the
technology sector.199
Data security
Both Congress and the Biden Administration are considering restricting cross-border data
flows or supporting data localization in instances when national security or the security of
sensitive data on U.S. citizens is at risk. A February 2024 executive order by the Biden
Administration aims to restrict access to Americans’ personal data and American
government related data when access poses an “unacceptable national security risk” by
prohibiting and restricting certain transactions with foreign adversaries, including
China.200 Recent proposed legislation also aims to prevent access to Americans’ personal
data by foreign adversaries by restricting the activities of data brokers, including the
Protecting Americans’ Data from Foreign Adversaries Act (H.R. 7520) and the Protecting
Military Servicemembers’ Data Act of 2023 (H.R. 6573).
Data localization
A component of Tik Tok’s Project Texas is the storage of U.S. user data in servers in
Oracle’s U.S. cloud environment with access to that data controlled by TikTok USDS,
which would be overseen by an independent board.201 This component of Project Texas,
if mandated by the Committee on Foreign Investment in the United States (CFIUS) or
another U.S. government entity, would be an example of an attempted data localization
requirement.
Digital trade policy
USTR has not announced new digital trade policy goals for future discussions with other
countries or put forth new proposals at the WTO. U.S. trade partners, industry, and other interests
could regard U.S. action on TikTok as a signal of the future direction of U.S. digital trade policy.
Further Reading
CRS Report R47662, Defining and Regulating Online Platforms, coordinated by Clare Y. Cho.
CRS Legal Sidebar LSB10940, Restricting TikTok (Part I): Legal History and Background, by
Steve P. Mulligan.
CRS Legal Sidebar LSB10942, Restricting TikTok (Part II): Legislative Proposals and
Considerations for Congress, coordinated by Peter J. Benson.
CRS Legal Sidebar LSB10972, Montana’s TikTok Ban, an Injunction, and Pending Legal Actions,
by Sanchitha Jayaram and Madeline W. Donley.

199 Fireside chat with USTR Katherine Tai, Aspen Security Forum, December 7, 2023. Remarks available at
https://www.aspensecurityforum.org/dc-2023-videos.
200 Executive Office of the President, Executive Order 14117 Preventing Access to Americans’ Bulk Sensitive Personal
Data and United States Government-Related Data by Countries of Concern, February 28, 2024.
201 TikTok U.S. Data Security, “About Project Texas,” available at https://usds.tiktok.com/usds-about/.
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CRS Legal Sidebar LSB11127, H.R. 7521 Regulation of TikTok: Analysis of Selected Legal
Issues, by Peter J. Benson, Valerie C. Brannon, and Joanna R. Lampe.
CRS In Focus IF11334, CFIUS: New Foreign Investment Review Regulations, by Cathleen D.
Cimino-Isaacs.
CRS In Focus IF11803, U.S. Capital Markets and China: Issues for Congress, by Michael D.
Sutherland and Karen M. Sutter.
CRS In Focus IF12347, Digital Trade and Data Policy: Select Key Issues, by Danielle M.
Trachtenberg.
Co-Authors and Contributors
The CRS Analysts listed below co-authored and contributed to this report:
• Peter J. Benson, Legislative Attorney (Coordinator)
• Valerie C. Brannon, Legislative Attorney
• Kristen E. Busch, Analyst in Science and Technology Policy (Coordinator)
• Cathleen Cimino-Isaacs, Specialist in International Trade and Finance
• Clare Y. Cho, Specialist in Industrial Organization and Business Policy
• Joanna R. Lampe, Legislative Attorney
• Chris D. Linebaugh, Legislative Attorney
• Michael D. Sutherland, Analyst in International Trade and Finance (Coordinator)
• Karen M. Sutter, Specialist in Asian Trade and Finance
• Danielle M. Trachtenberg, Analyst in International Trade and Finance
• Ling Zhu, Analyst in Telecommunications Policy

Author Information

Michael D. Sutherland, Coordinator
Peter J. Benson, Coordinator
Analyst in International Trade and Finance
Legislative Attorney

Kristen E. Busch, Coordinator

Analyst in Science and Technology Policy

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Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
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under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
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