President Donald Trump has issued an executive order that temporarily halts the enforcement of a law requiring ByteDance, TikTok’s Chinese parent company, to sell its stake in the app. Signed on Trump’s first day back in office, the order delays the provisions of the Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACA). This law mandates ByteDance divest its control over TikTok to a company not linked to a “foreign adversary,” with the looming threat of a U.S. ban if not complied with.
The executive order grants ByteDance an additional 75 days to meet the law’s requirements before facing penalties, which include a possible TikTok ban in the U.S. During this period, the Department of Justice (DOJ) has been directed not to take any enforcement actions, offering a temporary reprieve for both ByteDance and companies supporting TikTok.
Impact on U.S. Companies
Trump’s order also provides temporary protection to major U.S. companies such as Apple and Google, which could face fines if they continue to work with TikTok. The executive order specifies that the DOJ will not pursue penalties or enforcement actions for any noncompliance with the law during the 75-day window. This includes activities carried out between January 19, 2025, and the order’s issuance.
The order is seen as an attempt to ease the concerns of U.S. tech companies worried about facing severe legal consequences if they maintain partnerships with TikTok. In particular, it offers assurance that there will be no immediate repercussions for continuing to host TikTok on app stores.
Legal Uncertainty Surrounding the Order
The executive order directly challenges the bipartisan PAFACA, which was enacted to address national security issues. The law, which became effective on January 19, 2025, mandates ByteDance to divest its ownership of TikTok or face penalties. A 90-day extension for compliance is only granted if ByteDance has initiated the sale of its stake by the deadline, but no such sale has occurred.
Legal experts have raised concerns about the order’s legality. They argue that the executive order does not override the established law, which was passed by Congress and upheld by the Supreme Court. Furthermore, despite the temporary relief offered to U.S. companies, they still face the risk of fines—estimated at $850 billion—if the law is violated, even years after the order expires.
Risks for Tech Companies
While Trump’s order provides some short-term legal protection for companies like Apple and Google, it does not eliminate the long-term risks of noncompliance. The law allows enforcement actions to be pursued up to five years after a violation, leaving service providers exposed to future litigation. Additionally, the executive order clarifies that it does not create enforceable rights for companies, meaning that it may not serve as a reliable defense in the event of legal challenges.
Given the potential for massive fines and reputational damage, many companies may opt for caution, refraining from reinstating TikTok in app stores until there is greater clarity on the legal and political implications.
TikTok’s Future in Limbo
In an unexpected development, Trump also proposed a “joint venture” between the U.S. government and a private company to own 50% of TikTok, although the specifics of this plan remain unclear. Meanwhile, TikTok briefly went offline on Sunday but quickly resumed operations, though it remains unavailable for download on Apple’s and Google’s app stores.
The app’s future in the U.S. remains uncertain as legal and political tensions continue to mount. The unresolved issues surrounding TikTok’s ownership and the regulatory framework could result in further delays or complications in the app’s ability to operate in the U.S. long-term.
National Security and Political Implications
The ongoing debate over TikTok’s ownership has centered around concerns about data privacy and potential Chinese government influence. These issues led Trump to issue an executive order banning TikTok during his first term, though the move was overturned in court.
Now, with the new executive order, Trump is once again taking a stance that could interfere with bipartisan efforts to regulate foreign influence and protect U.S. national security. Critics argue that this action undermines the law passed with broad support and could set a concerning precedent for future attempts to limit foreign control over critical U.S. digital infrastructure.
The Tech Industry’s Dilemma
For U.S. tech companies, Trump’s order creates a precarious situation. Although it provides temporary legal relief, the looming threat of large penalties and the ongoing uncertainty about TikTok’s future make it difficult for companies to confidently resume or continue business with the app. Legal experts warn that providers may avoid taking risks that could lead to significant financial consequences, especially when future enforcement remains possible.
Comments are closed.