Stinson's Lomuscio Examines Impact of TikTok Ban for Chinese-based Businesses in U.S. Markets

06.04.2024

Stinson LLP Partner Richard Lomuscio authored an article for Bloomberg Law, "US Effort to Force TikTok Sale Challenges US-China Dealmaking." Lomuscio analyzes the possible TikTok ban and its impact for Chinese companies doing business in the United States.  

Though the popular social media app has faced increased scrutiny from U.S. lawmakers due to national security concerns stemming from TikTok's Chinese ownership, Lomuscio says an outright ban on TikTok is neither practical nor possible.

"Banning anything in the US is relatively difficult, but TikTok's own saving grace might be a core freedom that the Chinese government regularly impedes. The Department of Justice will need to prove the platform presents a threat to national security to overcome legal challenges based on free speech," he says. "The impending TikTok ban, coupled with new sanctions and tariffs, portends legal and business prospects for particular China-based companies that operate in the US, especially those that wish to continue access to US retail and capital markets."

Lomuscio details the complexities surrounding the TikTok ban and the varying degrees of regulatory scrutiny faced by Chinese businesses across different U.S. industries, as well as outlining strategies for navigating the evolving U.S.-China business and dealmaking landscape.

Lomuscio also provides insight on the proposed ban and its impact for Chinese companies doing business in the United States in an article for Law360, "What TikTok's Race Against The Clock Teaches Chinese Firms." In the article, Lomuscio says the purported TikTok ban is an effort to force parent company ByteDance to divest its U.S. business. "It provides useful information for other China-based companies about what is currently permissible amid changing U.S. rules and regulations," he says.

Lomuscio is a litigator and strategic advisor with over 20 years of experience navigating complex legal disputes. He represents technology, insurance, financial services and FinTech companies in commercial and regulatory matters involving securities, intricate financial instruments, mortgage securitizations, cryptocurrency, fund formation and corporate governance.

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