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Executive Order Will Ban U.S. Transactions With TikTok

The measure has the potential to cripple the video-sharing app that has become an increasingly valuable marketing tool for franchise brands.

Just as franchise brands were realizing the full marketing value of TikTok, the video-sharing app is now facing an existential threat from President Trump, who on Thursday signed an executive order banning U.S. companies from doing business with the Chinese-owned company.

The order, which will go into effect in 45 days, will allow the U.S. Commerce Secretary to fine and even imprison Americans and American companies who do business with TikTok. That 45-day window will allow Microsoft, which has been rumored to be interested in acquiring TikTok, to do so if it moves quickly. 

TikTok, like many apps, collects troves of data from millions of Americans, but because TikTok’s parent company, ByteDance, falls under the jurisdiction of the Chinese Government, President Trump has deemed it a threat to national security. 

Should ByteDance reject an acquisition from Microsoft or another U.S. company, TikTok will be severely hampered in the U.S., putting its efficacy as a marketing tool for franchise brands and every other business at risk.