By Andrew Restuccia and John D. McKinnon
WASHINGTON--President Trump signed an executive order Tuesday
banning transactions with eight Chinese-connected apps, including
the Alipay payment platform owned by Chinese billionaire Jack Ma's
Ant Group Co. and apps owned by Chinese tech giant Tencent Holdings
Ltd.
Mr. Trump said the apps can access private information from
their users. It could be used by the Chinese government to "track
the locations of Federal employees and contractors, and build
dossiers of personal information," he added.
The order takes effect in 45 days--after Mr. Trump leaves
office. A spokesman for President-elect Joe Biden's transition team
declined to comment on the order.
U.S. companies that do business with China--including Apple
Inc., Ford Motor Co., Walmart Inc. and Walt Disney Co-- previously
objected to an executive order by Mr. Trump targeting Tencent's
WeChat multipurpose app, saying it was vital to conducting business
there. U.S. businesses might raise similar concerns about the new
order.
A federal judge has issued a preliminary injunction blocking
that order, which the government has appealed.
In a briefing, a senior administration official said the new
executive order was aimed at preventing U.S. users' data from being
used by the Chinese government to fuel what the official termed its
"mass tool for global oppression."
"This is another example of the U.S. stretching the concept of
national security, abusing its national power, to oppress foreign
companies," Chinese Foreign Ministry spokeswoman Hua Chunying said
Wednesday. "It has some impact on Chinese companies but more
importantly, it would eventually hurt the interests of American
consumers."
One former U.S. trade official said the executive order could
raise new concerns among businesses about the potential for
restricting some transactions in China, a hot market for many U.S.
multinationals.
At the same time, the Trump administration's move also raises
the stakes for the incoming Biden administration by highlighting
increasingly worrisome issues of national security, privacy and
lack of access to China for some U.S. tech firms.
Alipay, a payment and lifestyle app with more than 1 billion
users, is owned by Ant Group, the Chinese financial-technology
giant controlled by Mr. Ma. An Ant representative had no immediate
comment.
The executive order also applies to three apps owned by
Tencent-- WeChatPay, QQWallet and Tencent QQ. A Tencent
representative had no immediate comment.
While WeChat and Alipay are ubiquitous in China, they are less
popular in the U.S. Alipay, for example, was downloaded 207,000
times in the U.S. last year from Apple's App Store and the Google
Play app store, according to the research firm Sensor Tower Inc.
WeChat--which includes WeChat Pay--was downloaded 1.6 million times
last year, Sensor Tower said.
In addition to the apps owned by Ant and Tencent, the order
applies to Camscanner, a scanning app owned by INTSIG Information
Co. in Shanghai. According to Sensor Tower, it had 4.4 million
downloads in the U.S. last year.
The ban also applies to Chinese-connected apps known as SHAREit,
Vmate and WPS Office.
The new move comes after the Trump administration issued a pair
of executive orders in August meant to impose new limits on the
Chinese social-media apps TikTok and WeChat, citing national
security concerns. Both orders have faced legal challenges.
Two federal judges also separately blocked the Trump
administration's TikTok ban from going into effect. The ban would
have restricted U.S. companies from conducting transactions with
TikTok, including hosting the company's data and delivering the
company's content, which would have essentially made the app
inoperable in the U.S.
In issuing its executive order calling on TikTok to effectively
be shut down or sold to a U.S. company, the administration said it
feared ByteDance could share information about U.S. users with the
Chinese government. The company said it would never do so.
Anna Ashton, vice president for government affairs at the
U.S.-China Business Council, said Mr. Trump's order appeared to be
based on the possibility that data could be shared with China's
government--and not on any actual incidents.
"As with the WeChat and TikTok executive orders, the underlying
threat that the administration is identifying here is not clearly
tied to any specific actions taken by the companies named in the
order," Ms. Ashton said in a statement. "Chinese data breaches and
hacking activities are referenced, but they are not tied directly
to the companies the president has targeted.
A senior administration official said the White House continues
to believe its earlier orders concerning WeChat and TikTok are
valid. The official added that the new one likely couldn't be
attacked under the International Emergency Economic Powers Act, the
particular law that has tripped up the earlier orders.
The Trump administration also has sought to restrict
Chinese-based telecommunications firms such as Huawei Technologies
Co. through executive orders. Those actions were aimed at securing
U.S. networks but also appeared to undercut the Chinese firms'
competitiveness around the world when next-generation 5G wireless
service is beginning to be made available.
Liza Lin contributed to this article.
Write to Andrew Restuccia at Andrew.Restuccia@wsj.com and John
D. McKinnon at john.mckinnon@wsj.com
(END) Dow Jones Newswires
January 06, 2021 06:13 ET (11:13 GMT)
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