The photo illustration shows the TikTok logo displayed on a mobile phone screen.
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Canadian investor Kevin O’Leary is still interested in a TikTok deal, but it’s not possible under current law, he told CNBC, after President Donald Trump extended a deadline to ban the social media platform.
As part of a wave of executive orders on Monday, Trump delayed for 75 days a law that would effectively ban TikTok in the US, allowing “an opportunity to determine the appropriate course of action.”
Trump had promised the move in a social media post on Sunday, also bringing up a deal that would see the platform remain active under a 50% American-owned joint venture.
“For that 50/50 deal, I’d like to work with Trump, and so would any other potential buyer… But the problem with some of these ideas is that they’re inconsistent with the Supreme Court decision,” he said. O’Leary. , best known for his role on ABC’s “Shark Tank.”
The investor announced that he, along with the People’s Bid for TikTok, an effort led by Liberty Project founder Frank McCourt, had offered ByteDance $20 billion in cash to buy TikTok in an appearance on America’s Newsroom. Fox News.
Speaking to CNBC, he said the proposed deal does not include ByteDance’s TikTok algorithm, which has been a key point of scrutiny by US lawmakers, adding that his group had an alternative algorithm.Â
ByteDance had not announced any deal before Sunday’s deadline to exit TikTok after the Supreme Court upheld the Protecting Americans from Foreign Adversary Controlled Applications Act, or PAFACA, that applies to TikTok.
McCourt confirmed to CNBC that the Project Liberty team remained “ready to work collaboratively with the Trump Administration, ByteDance and a consortium of US partners to finalize this critical agreement.”
“Project Liberty has a proven technology staff that is already in place and provides a clear path to address Congress’ national security concerns while keeping TikTok operational,” he added.
Legal obstacles
Firms involved in TikTok have had mixed reactions to Trump’s executive order. Service providers like Oracle and Akamai have willingly kept TikTok online, while Apple and Google have yet to restore ByteDance-owned apps to their stores.
According to O’Leary, while Trump’s extension of the ban likely provided protections for Oracle and Akamai, it is unclear whether ByteDance’s deadline to opt out will be extended.
“What we need is not really a 75-day extension. What we need is to go back and ask Congress to open up the order and provide these new options, because they are not provided for now,” he said.
“I would like to make a deal, if the law provided for it, but I do not have the luxury of violating the order of Congress,” he added.
Legal experts who spoke to CNBC agreed that the legal status of TikTok and Trump’s executive order remained uncertain and that any attempt to make a TikTok deal could face challenges.
“The order does not appear to comply with the statute. Congress carefully inserted certain dates and procedures into the law, which SCOTUS found to be constitutional,” said Carl Tobias, a law professor at the University of Richmond.
“So a federal court could find that the Order violates the law and invalidate it,” he said, adding, however, that such action could take a long time if the government appeals to SCOTUS.
Sarah Kreps, director of the Technology Policy Institute at Cornell University, agreed that the executive order was inconsistent with the Supreme Court ruling, adding that it said nothing about progress toward a qualified sale.
Given that violators of TikTok’s law could face billions in fines, it’s not entirely prudent for parties to take Trump’s assurances on the law and the SCOTUS ruling, Kreps said.
“They are certainly gambling with the law and putting too much faith in executive authority,” she added.
China softens stance?
O’Leary told CNBC that TikTok could fetch $20 billion to $30 billion in the market in March of last year, a huge discount given that any sale would likely exclude the platform’s algorithms.
Instead, the value in a potential deal was the opportunity to acquire TikTok’s strong domestic brand and its 100 million-plus users, he said.
However, as talk of selling TikTok grew, Beijing was seen as a major obstacle to a BytdeDance investment.Â
However, China recently signaled openness to a deal that would see US companies gain ownership of the platform.
“When it comes to actions such as operating and acquiring businesses, we believe they should be decided independently by companies in accordance with market principles,” a Beijing spokesman told reporters on Monday when asked about the proposal. of President Donald Trump.
According to O’Leary, any potential sale of ByteDance is still expected to be negotiated between Trump and Chinese President Xi Jinping.
“With TikTok, I have the right to sell it or shut it down, and we will decide and we may have to get an approval from China as well,” Trump told reporters after his inauguration.
During the signing of the executive order, the President reportedly suggested that he could impose tariffs on China if Beijing fails to approve a US deal with TikTok. On Monday in the state, he said he would consider the possibility of Tesla CEO Elon Musk or Oracle chairman Larry Ellison buying TikTok.
Meanwhile, O’Leary told CNBC that he was in Washington still working on a potential TikTok deal with US lawmakers.
