Several US corporations expressed concern about the impact of WeChat‘s executive order made by Trump’s administration.
“More than a dozen” companies, including Apple, Toyota, Target, and Disney, took in Tuesday’s call with White House officials. The companies outlined the adverse effects that a WeChat ban might have on their own businesses.
President Donald Trump signed an executive order on Thursday night. There is already a lot of uncertainty regarding the expected scope of the ban. One explanation for the call between the White House and the US companies was to further explain the order.
Any violent reactions, US Companies?
Several participants shared frustration over the wording of the directive. According to The Wall Street Journal, the ban could directly affect US firms worldwide, particularly in China.
Once the executive order comes into effect in September, anyone in the US is prohibited from conducting any “transaction” with WeChat or its parent company Tencent.
Owned by internet giant Tencent, WeChat is China’s leading messaging software. Several people use the application for cashless payments, e-commerce, marketing, and many more. It’s no joke to say it’s an omnipresent force in modern Chinese life. Any smartphone without access to it will be an incredibly tricky sale.
“For those who don’t live in China, they don’t understand how vast the implications are if American companies aren’t allowed to use it,” said Craig Allen, president of the U.S.-China Business Council. “They are going to be held at a severe disadvantage to every competitor,” he added.
The ban may also affect Apple. The tech giant may no longer be able to sell competitive goods on the world’s largest smartphone market. The App Store without WeChat will be much more of a problem for the Chinese iPhone than for Huawei elsewhere to skip Google apps.
Some participants also expressed concerns about how the order extends to Tencent and its other outlets. They pointed out the possible difficulties that the National Basketball Association faces with its sponsorship agreements with Tencent, which broadcasts NBA games with China.
Organizations refused to comment or further discuss the issue after their meeting. The US-China Business Council, the US Chamber of Commerce and the Business Roundtable organized the call between the companies and the White House.
Why the ban, White House?
A White House spokesperson told WSJ the government aims to protect the American people from all cyber-related risks.
The Trump administration announced the move against Tencent. According to them, WeChat collects “vast swaths of information from its customers.” The application also reveals the sensitive information of Americans and Chinese citizens residing in the US.
Chinese officials are also raising concerns surrounding the proposed ban in US trade talks, Bloomberg News has reported.
Tencent Chief Financial Officer John Lo said the firm assumes that the executive order applies only to WeChat’s international edition and not to the domestic Chinese market.
“We are in the process of seeking further clarification from relevant parties in the US,” Mr. Lo said.
The White House recently made an order to ban the video-sharing device TikTok. The maker of TikTok, Beijing-based ByteDance Ltd., is in talks to divest their activities in the United States. Microsoft and Twitter have shown interest in buying the said application.