Report: China would prefer TikTok shut down in the US before selling to Microsoft or Oracle

With the TikTok US ban deadline around the corner, things are heating up as the Chinese government has reportedly taken the stance that it would rather see the app’s US operations shut down than sold to an American company.

Three anonymous sources close to the matter told Reuters today that China is opposed to the sale so much that it would prefer to see the social media service just close up shop in the US.

Beijing opposes a forced sale of TikTok’s U.S. operations by its Chinese owner ByteDance, and would prefer to see the short video app shut down in the United States, three people with direct knowledge of the matter said on Friday.

That’s said to be because China thinks a sale would reflect poorly on the country:

…Chinese officials believe a forced sale would make both ByteDance and China appear weak in the face of pressure from Washington, the sources said, speaking on condition of anonymity given the sensitivity of the situation.

For its part, TikTok parent company ByteDance said “the Chinese government had never suggested to it that it should shut down TikTok in the United States or in any other markets.”

However, all of this makes more sense as we learned yesterday that ByteDance was pursuing a restructuring deal with the US government with more intensity to avoid the ban, instead of coming to an agreement to sell some of its TikTok operations.

As we previously reported, China could take legal action to prevent the sale of TikTok’s US business via recently amended laws. With the US ban quickly approaching, shutting the US operations down or a restructuring deal look like the most likely scenarios.

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