Oracle Corp.’s bid for TikTok falls short of resolving concerns of Trump administration officials that the Chinese-owned video-sharing app poses a risk to U.S. national security, according to people familiar with the matter.
President Donald Trump has the authority to sign off on a deal, but continuing concerns from national security officials could sway his decision. The agreement remains on the table, with discussions continuing between administration officials and the companies, said the people, who asked not to be named because the talks are confidential.
Addressing those remaining issues could pave the way for U.S. approval, the people said.
The officials, including Secretary of State Michael Pompeo, are concerned that after a potential transaction, TikTok’s Chinese owner, ByteDance Ltd., could still have access to user data from its nearly 100 million users in America, said the people. The officials remain wary about the proposed new ownership structure and how much influence that would give China over the company.
Treasury Secretary Steven Mnuchin has reviewed the proposed deal. Attorney General William Barr was only briefed on the deal Wednesday and is reviewing it, according to a Justice Department official who declined further comment. Barr spoke with Oracle executives Wednesday morning, two people familiar with the situation said. Pompeo had a conversation the company officials last week.
TikTok has emerged as a top target in Trump’s effort to crack down on China ahead of the Nov. 3 election. The president is trailing his Democratic opponent Joe Biden in the polls and seeking to use his tough stance with Beijing as a selling point to voters.
The Treasury, State and Justice departments are all part of the Committee for Foreign Investments in the U.S., or Cfius, that reviews deals for national security implications. In a meeting Tuesday afternoon, officials raised concerns about a deal that would leave a majority stake of TikTok’s U.S. assets in ByteDance’s hands, with Oracle taking a minority share, the people said.
The panel is expected to meet again Wednesday to discuss the potential sale, according to one of the people.
White House press secretary Kayleigh McEnany said a decision on TikTok is coming in “short order” during a briefing with reporters.
“We care deeply about protecting the data and security of American citizens.”
Spokespeople for Treasury and State declined to comment. The Justice Department official didn’t immediately reply to a question about whether the attorney general had spoken to Oracle.
— With assistance by Chris Strohm