Planned TikTok deal entails China's approval under revised catalogue: expert

The logo of TikTok is seen on a smartphone screen in Arlington, Virginia, the United States, Aug. 30, 2020. (Xinhua/Liu Jie)

BEIJING, Aug. 30 (Xinhua) -- ByteDance, the parent company of TikTok, will need to comply with approval procedures under China's latest revision to the catalogue of technologies that are subject to export bans or restrictions, regarding the planned selling of the video-sharing app's U.S. operations, an expert observed.

As a fast-growing innovative enterprise, ByteDance has many cutting-edge technologies in artificial intelligence and other fields, and some technologies may have been covered by the adjusted catalogue, Professor Cui Fan at the University of International Business and Economics told Xinhua in an interview commenting on the catalogue.

The revised catalogue, released jointly on Friday by the Ministry of Commerce and the Ministry of Science and Technology, added a total of 23 items subject to export restrictions.

Two new items under the category of information processing technology in the computer service industry were cited by Cui as relevant in the TikTok deal, which was the "personalized information push service technology based on data analysis" and "artificial intelligence interactive interface technology."

The rapid development of ByteDance's international businesses has been built on the strong technical support based in China, Cui said, noting that the company's act of offering core algorithm services to overseas branches constitutes a typical export of technical services.

"For the international business to continue to operate smoothly, no matter who its new owner and operator are, it is highly likely that there will need to be a transfer of software codes or right of use from inside China to outside China," Cui said. "Technical services provision from inside China to outside China may also be needed."

"Therefore, it is suggested that ByteDance carefully study the revised catalogue, seriously and carefully consider whether it is necessary to suspend substantive negotiations on relevant transactions, comply with statutory application and reporting procedures, and then take further actions as appropriate," Cui said.