Treasury Secretary Steven Mnuchin confirmed Wednesday that social media app TikTok is being reviewed by department's Committee on Foreign Investment in the U.S.
In comments on the South Lawn of the White House alongside President Donald Trump, Mnuchin told reporters his department would be "making a recommendation to the president." CFIUS has authority to review foreign investments, and in this case appears to be looking at a prior acquisition by TikTok's parent company, ByteDance. The company acquired TikTok precursor Musical.ly in 2017 and CNBC previously reported that CFIUS was looking into potential national security risks involved in that deal.
"We are looking at TikTok," Trump said Wednesday. "We are thinking about making a decision."
Earlier this month, Secretary of State Mike Pompeo said the U.S. was looking at banning TikTok as well as other Chinese social media apps, citing national security concerns.
Pompeo added that the Trump administration was evaluating TikTok akin to Chinese state-backed tech companies Huawei and ZTE, which he has previously described as "Trojan horses for Chinese intelligence."
U.S. officials have long complained that Chinese intellectual property theft has cost the economy billions of dollars in revenue and thousands of jobs and threatens national security. Beijing maintains it does not engage in intellectual property theft.
The comments Wednesday by Trump and Mnuchin came just ahead of a midday hearing where the CEOs of tech giants Amazon, Apple, Facebook and Google are scheduled to testify before the House Judiciary subcommittee on antitrust. Trump said he would "be watching the hearings today very closely. Because there is no question that what the Big Tech companies are doing is very bad."
In his prepared testimony, Facebook CEO Mark Zuckerberg referred to the threat of tech companies built without democratic American values, calling out China in particular. The line could be easily interpreted as a jab at TikTok, though it was not mentioned by name. TikTok is not offered in China and says it does not store U.S. users' data there. Still, lawmakers have expressed concerns that the Chinese Communist Party could compel the company to hand over data on U.S. users, a claim the company has denied.
Republicans and Democrats have recently pushed to remove TikTok from government-owned devices. An amendment to a defense bill that would ban TikTok from such devices passed in the House last week, and former Vice President Joe Biden's presidential campaign reportedly told staff to remove it from their personal and work devices due to security concerns, according to multiple outlets.
The Pentagon has taken concrete steps to discourage U.S. service members and their families from using Chinese-backed tech.
In December, the Defense Information Systems Agency advised that all Department of Defense personnel should not use the Chinese-owned social media platform, citing a "potential risk associated with using the TikTok app." A year earlier, the Pentagon halted sales of Huawei and ZTE mobile phones and modems on military bases around the world again citing national security concerns.
Ahead of Wednesday's hearing, TikTok made a publicity push seemingly meant to preempt arguments against it that will likely come up at the hearing. The company's new CEO, ex-Disney executive Kevin Mayer, accused Facebook in a blog post of wrapping itself in patriotic language to distract from issues of competition. Facebook's Instagram now has a competing app with TikTok called Reels, which according to The Wall Street Journal has offered TikTok influencers incentives to move over to the new service.
TikTok's top lobbyist sent Mayer's blog post to leaders of the antitrust subcommittee and Judiciary Committee along with a letter objecting to "misconceptions" about its service's connections to China.
A TikTok spokesperson declined to comment on a CFIUS review but provided a statement about its job growth in the U.S.
"Our U.S. team has tripled since the start of 2020, and under the leadership of our American CEO Kevin Mayer, we're proud to be creating more than 10,000 jobs across the country as we continue our work to develop a best-in-class security infrastructure, promote a safe and positive app experience, and bring joy to millions of American families," the spokesperson said.