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Shou Zi Chew, chief executive officer of TikTok Inc., speaks during the Bloomberg New Economy Forum in Singapore, on Wednesday, Nov. 16, 2022.

Bryan van der Beek | Bloomberg | Getty Images

TikTok CEO Shou Zi Chew will face a tough crowd on Thursday when he testifies before the House Energy and Commerce Committee while his company is on the brink of a potential ban in the U.S.

Although TikTok is the one in the hot seat on Thursday, the hearing will also raise existential questions for the U.S. government regarding how it regulates technology. Lawmakers recognize that the concerns over broad data collection and the ability to influence what information consumers see extend far beyond TikTok alone. U.S. tech platforms including Meta’s Facebook and Instagram, Google’s YouTube, Twitter and Snap’s Snapchat have raised similar fears for lawmakers and users.

That means that while trying to understand whether TikTok can effectively protect U.S. consumers under a Chinese owner, lawmakers will also have to grapple with how best to address consumer harms across the industry.

Conversations with lawmakers, congressional aides and outside experts ahead of the hearing reveal the difficult line the government needs to walk to protect U.S. national security while avoiding excessive action against a single app and violating First Amendment rights.

Evaluating a potential ban

There’s little appetite in Washington to accept the potential risks that TikTok’s ownership by Chinese company ByteDance poses to U.S. national security. Congress has already banned the app on government devices and some states have made similar moves.

The interagency panel tasked with reviewing national security risks stemming from ByteDance’s ownership has threatened a ban if the company won’t sell its stake in the app.

Still, an outright ban raises its own concerns, potentially missing the forest for the trees.

“If members focus solely on the prospect of a ban or a forced sale without addressing some of the more pervasive issues, particularly those facing children and younger users, shared by TikTok and U.S.-based social media companies, I think that would be a mistake,” Rep. Lori Trahan, D-Mass., a committee member, told CNBC in an interview on Tuesday. Trahan said members should ask about national security risks of the app, but those questions should be substantive.

A TikTok advertisement at Union Station in Washington, DC, US, on Wednesday, March 22, 2023. 

Nathan Howard | Bloomberg | Getty Images

Rep. Gus Bilirakis, R-Fla., who chairs the E&C subcommittee on innovation, data and commerce, said he and many of his colleagues are going into the hearing open to solutions.

“We have to be open-minded and deliberate,” Bilirakis told CNBC in an interview on Wednesday. “But at the same time, time is of the essence.”

If the government moves for a ban where the concerns could reasonably be mitigated with a less restrictive measure, it could pose First Amendment issues, according to Jameel Jaffer, executive director of the Knight First Amendment Institute at Columbia University.

“A ban here is in some ways under-inclusive because it would be focused just on TikTok or a small number of platforms, when in fact many other platforms are collecting this kind of information as well,” Jaffer said. “And in other ways, it would be over-broad because there are less restrictive ways that the government could achieve its ends.”

While some might wonder if cutting off Americans’ access to TikTok is really such a violation of rights, Jaffer said the public should consider it in terms of the U.S. government’s authority to decide which media Americans can access.

“It’s a good thing that if the government wants to ban Americans from accessing foreign media, including foreign social media… it has to carry a heavy burden in court,” Jaffer said.

Many lawmakers agree that the government should make its case more clearly to the American public for why a ban is necessary, should it go that route. The bipartisan RESTRICT Act recently introduced in the Senate, for example, would require such an explanation, to the extent possible, when the government wants to limit foreign-owned technology for national security reasons.

Trahan said she could support legislation similar to the RESTRICT Act in the House, which would create a process to mitigate national security risks of technologies from foreign adversary countries, but passing such a bill would still not be enough.

“The message that I want folks to hear is that we cannot afford to pass this legislation or something like it, watch the administration ban or force the sale of TikTok and declare victory in the fight to rein in the abuses of dominant Big Tech companies,” Trahan said. “I think the conversation right now about a ban certainly threatens to let Big Tech companies off the hook, and it’s on Congress not to fall into that trap.”

Even if the U.S. successfully banned TikTok or forced it to spin off from ByteDance, there’s no way to know for sure that any earlier-collected data is out of reach of the Chinese government.

“If that divestment would occur, how do you segregate the code bases between ByteDance and TikTok?” asked John Lash, who advises clients on risk mitigation agreements with the Committee on Foreign Investment in the U.S. (CFIUS) but hasn’t worked for TikTok or ByteDance. “And how is the U.S. government going to get comfortable that the asset, TikTok, which is hypothetically sold, is free of any type of backdoor that was either maliciously inserted or just weaknesses in code, errors that occur regularly in how code is structured?”

“I think the concern is valid. My big issue is that genie’s sort of out of the bottle,” Eric Cole, a cybersecurity consultant who began his career as a hacker for the Central Intelligence Agency, said of the data security fears. “At this point, it’s so embedded that even if they were successful in banning Tiktok altogether, that the damage is done.”

Addressing industry-wide concerns

Thursday’s hearing will feature several lawmakers on both sides of the aisle calling for comprehensive privacy reform, like the kind the panel passed last year but never made it to the floor for a vote.

Those calls serve as recognition that many of the concerns about TikTok, apart from its ownership by a Chinese company, are shared by other prominent tech platforms headquartered in the U.S.

Both Trahan and Bilirakis mentioned the need for privacy reform as a more systemic solution to the issues raised by TikTok. Both are especially concerned about the social media company’s potentially harmful impacts on children and said they would drill down on TikTok’s protections in the hearing.

TikTok has touted a complex plan known as Project Texas to help ease U.S. concerns over its ownership. Under the plan, it will base its U.S. data operations domestically and allow its code to be reviewed and sent to the app stores by outside parties.

A TikTok advertisement at Union Station in Washington, DC, US, on Wednesday, March 22, 2023. 

Nathan Howard | Bloomberg | Getty Images

Chew plans to tell Congress that he strongly prioritizes the safety of users, and particularly teens, that TikTok will firewall U.S. user data from “unauthorized foreign access,” it “will not be manipulated by any government” and it will be transparent and allow independent monitors to assess its compliance.

Experts and even some lawmakers acknowledge that Project Texas offers a step forward on some aspects of consumer protection they’ve pushed for in the tech industry more broadly.

“TikTok is in a really unique position right now to take some positive steps on issues that a lot of top American companies have fallen behind and frankly even regressed on whether it’s protecting kids or embracing transparency,” Trahan said. While she believes there are still many questions TikTok needs to answer about the adequacy of Project Texas, Trahan said she is “hopeful” about the company’s professed “openness to stronger transparency mechanisms.”

Lawmakers and aides who spoke with CNBC ahead of the hearing emphasized that comprehensive privacy legislation will be necessary regardless of what action is taken against TikTok in particular. That’s how a similar situation in the future may be prevented, and a way to hold U.S. companies to higher standards as well.

But given federal digital privacy protections don’t currently exist, Lash said the U.S. should consider what it would mean if Project Texas were to go away.

“In lieu of comprehensive federal data privacy regulation in the United States, which is needed, does Project Texas give the best available option right now to protect national security?” asked Lash, whose advisory is one of a small group of firms with the expertise to advise the company on an agreement should a deal go through. “And does it continue if ByteDance is forced to divest their interests?”

The plan appears to address the issues that lawmakers are concerned about, said Lash, but what it can’t address are “the theoretical risks around may happen, could happen as it relates to the application.”

“I would say, based on what I’ve seen out in the public, it does seem to comprehensively address a lot of the real technical risks that may be arising,” he said.

Still, policymakers appear skeptical that Project Texas reaches that bar.

An aide for the House Energy and Commerce Committee who was only authorized to speak on background told reporters earlier this week that TikTok’s risk mitigation plans were “purely marketing.” Another aide for the committee noted that even if the U.S. can be assured the data is secure, it’s impossible to comb through all the existing code for vulnerabilities.

E&C Chair Cathy McMorris Rodgers, R-Wash., supports a ban to address the immediate risks TikTok poses as well as comprehensive privacy legislation that passed through the committee last Congress to prevent repeat situations, according to E&C aides.

TikTok’s strategy

Rep. Jamaal Bowman (D-NY) speaks at a news conference outside the U.S. Capitol Building on February 02, 2023 in Washington, DC.

Anna Moneymaker | Getty Images

On Wednesday, Bowman held a press conference with dozens of creators, opposing the ban and saying rhetoric around the app is a sort of “red scare” pushed primarily by Republicans. He said he supports comprehensive legislation addressing privacy issues across the industry, rather than singling out one platform. Bowman noted lawmakers haven’t received a bipartisan congressional briefing from the administration on national security risks stemming from TikTok.

“Let’s not have a dishonest conversation,” Bowman said. “Let’s not be racist toward China and express our xenophobia when it comes to TikTok. Because American companies have done tremendous harm to American people.”

Reps. Mark Pocan, D-Wisc., and Robert Garcia, D-Calif., joined Bowman and the creators, announcing their opposition to a ban. Garcia, who is openly gay, said it’s important that young queer creators “are able to find themselves in this space, share information and feel comfortable, in some cases come out.”

“Honestly it’s done best on the TikTok platform than any other social media platform that currently exists, certainly in the United States,” Garcia said.

Creators at the event on Wednesday shared the opportunities that TikTok has afforded them that aren’t available in the same way on other apps. Several creators who spoke with CNBC said they have other social media channels but have far fewer followers on them, due in part to the easy discoverability built into TikTok’s design.

“I’ve been on social media for probably ten years,” said David Ma, a Brooklyn-based content creator, director and filmmaker on TikTok. But it wasn’t until he joined TikTok that his following grew exponentially, to more than 1 million people. “It’s given me visibility with people that are going to fundamentally change the trajectory of my career.”

Tim Martin, a college football coach in North Dakota who posts about sports on TikTok to a following of 1 million users, estimated 70% of his income comes from the app. Martin credits the TikTok algorithm with getting his videos in front of users who truly care about what he has to share, which has helped him grow his following there far more than on Instagram.

But TikTok’s attempt to shift the narrative to positive stories from creators and users may still fall flat for some lawmakers.

Bilirakis said the strategy is “not resonating with our colleagues. Definitely not with me.” That’s because he hears other anecdotes about constituents’ encounters with the app that make him worry for teens’ safety.

“I do think there’s a chance that it may not necessarily have the impact that TikTok is looking for,” said Jasmine Enberg, a social media analyst for Insider Intelligence. “It’s more evidence of how firmly entrenched the app is in the digital lives of Americans, which isn’t necessarily going to help convince us lawmakers that TikTok can’t be used or isn’t being used to influence public opinion.”

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Xiaomi delivers record cars in March as winners emerge in China’s EV race

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Xiaomi delivers record cars in March as winners emerge in China's EV race

A Xiaomi store in Shanghai, China, on March 16, 2025.

Qilai Shen/Bloomberg | Bloomberg | Getty Images

Chinese electric carmakers Xiaomi, Xpeng and Leapmotor each delivered nearly 30,000 or more cars in March, roughly twice several of their fellow startup competitors.

It’s a sign of how some automakers are pulling ahead, while BYD remains the market leader by far.

Xiaomi delivered a record number of electric vehicles in March, exceeding 29,000 units, the company announced on social media. That topped its prior run of delivering more than 20,000 vehicles in each of the past five months.

The SU7, Xiaomi’s flagship model, was involved in a crash on a highway on Tuesday that left three dead. The automaker on Tuesday afternoon released a statement on Chinese social media that the vehicle was in navigation on autopilot mode before the accident.

Based on preliminary information, the road was obstructed because of construction. The driver took control of the car but collided with construction infrastructure. Xiaomi added in the release that investigations were underway.

That came two weeks after the automaker announced on March 18 its goal to deliver 350,000 vehicles this year. There are also talks of the automaker expanding its second EV factory in Beijing to meet demand, Bloomberg reported on March 18. Xiaomi did not immediately respond to CNBC’s request for comment.

Its competitor Xpeng in March delivered 33,205 vehicles, the fifth consecutive month it has delivered over 30,000 units per month and reflecting a 268% surge in deliveries from the same month last year. March is also the fifth consecutive month the company has delivered over 15,000 units of the Mona M03.

Leapmotor delivered 37,095 vehicles, reflecting a 154% year-over-year growth. The Stellantis-owned automaker last month launched U.K. sales of two electric vehicle models, the T03 and the C10.

Li Auto delivered 36,674 vehicles in March, a 26.5% year-over-year increase, but fewer than every month in the second half of 2024. The company’s cars had gained early traction with Chinese consumers since most come with a fuel tank for charging the vehicle’s battery, reducing anxiety about driving range.

Tesla takes two of three top spots in China's most popular EV list

BYD sold 371,419 passenger vehicles in March, reflecting a year-over-year growth of 57.9%. Its overseas sales volume also hit a record high of 72,723 units in March.

In the same month, the automaker unveiled its “Super e-Platform” technology, which boasts 400 kilometers (roughly 249 miles) of range with five minutes of charging. The company in February also announced that it was integrating DeepSeek artificial intelligence to develop “DiPilot,” its advanced driver-assistance system.

Across the board, major companies across China’s electric car industry reported deliveries rose last month, indicating a pick-up in demand from the seasonally soft first two months of the year.

U.S. automaker Tesla sold 78,828 electric vehicles in China in March, marking a 11.5% year-over-year decline in growth.

Other Chinese carmakers saw growth in deliveries but some still struggled to break through the 20,000-unit mark.  

Nio delivered 15,039 vehicles, a 26.7% year-over-year growth, but well below the number of cars delivered in the months of May to December last year. Nio-owned Onvo, which markets its electric vehicles as family-oriented, in March recorded 15,039 units in deliveries.

Geely-owned Zeekr delivered 15,422 vehicles in March, increasing by 18.5% year over year. The company last month announced its rollout of free advanced driver-assistance technology to local customers in a bid to compete in the market.

Aito, as of April 2, has not published its delivery numbers for March. The automaker, which uses Huawei tech in its vehicles, on social media had reported monthly deliveries of 34,987 and 21,517 in January and February, respectively.

Quarterly performance

On a first-quarter basis, BYD remained in the lead with 986,098 vehicles sold. The automaker, which overtook Tesla in annual sales last year, surpassed the U.S. EV giant in battery electric vehicles sales this quarter.

Tesla sold 172,754 vehicles in China in the first quarter this year, according to monthly delivery numbers published by the China Passenger Car Association.

Xpeng also reported strong growth, with a total of 94,008 vehicles delivered in the quarter ending in March, reflecting a 331% year-over-year growth.

Leapmotor saw quarterly deliveries more than double to 87,552 units from 33,410 units the same period in 2024, according to publicly available numbers the company published.

However, Li Auto and Nio reported weaker growth than their competitors in the first quarter of the year.

Nio saw 42,094 vehicles delivered in the three months ended March 2025, an increase of 40.1% year over year. Li Auto saw a slower year-over-year growth of 15.5%, with a total of 92,864 vehicles delivered.

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De minimis trade loophole that boosted Chinese online retailers to end May 2

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De minimis trade loophole that boosted Chinese online retailers to end May 2

A driver for an independent contractor to FedEx delivers packages on Cyber Monday in New York, US, on Monday, Nov. 27, 2023.

Stephanie Keith | Bloomberg | Getty Images

President Donald Trump on Wednesday signed an executive order shutting the de minimis trade loophole, effective May 2.

Trump in February abruptly ended the de minimis trade exemption, which allows shipments worth less than $800 to enter the U.S. duty-free. The order overwhelmed U.S. Customs and Border Protection employees and caused the U.S. Postal Service to temporarily halt packages from China and Hong Kong. Within days of its announcement, Trump reversed course and delayed the cancellation of the provision.

Wednesday’s announcement, which came alongside a set of sweeping new tariffs, gives customs officials, retailers and logistics companies more time to prepare. Goods that qualify under the de minimis exemption will be subject to a duty of either 30% of their value, or $25 per item. That rate will increase to $50 per item on June 1, the White House said.

Use of the de minimis provision has exploded in recent years as shoppers flock to Chinese e-commerce companies Temu and Shein, which offer ultra-low cost apparel, electronics and other items. The U.S. Customs and Border Protection has said it processed more than 1.3 billion de minimis shipments in 2024, up from over 1 billion shipments in 2023.

Critics of the provision say it provides an unfair advantage to Chinese e-commerce companies and creates an influx of packages that are “subject to minimal documentation and inspection,” raising concerns around counterfeit and unsafe goods.

The Trump administration has sought to close the loophole over concerns that it facilitates shipments of fentanyl and other illicit substances on the claims that the packages are less likely to be inspected by customs agents.

Temu and Shein have taken steps to grow their operations in the U.S. as the de minimis loophole has come under greater scrutiny. After onboarding sellers with inventory in U.S. warehouses, Temu recently began steering shoppers to those items on its website, allowing it to speed up deliveries. Shein opened distribution centers in states including Illinois and California in 2022, and a supply chain hub in Seattle last year.

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Apple leads a drop in tech stocks after Trump tariff announcement

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 Apple leads a drop in tech stocks after Trump tariff announcement

Apple CEO Tim Cook, center, watches during the inauguration ceremonies for President Donald Trump, right, and Vice President JD Vance, left, in the rotunda of the U.S. Capitol in Washington, Jan. 20, 2025.

Shawn Thew | Afp | Getty Images

Apple slid more than 6% in late trading Wednesday and led a broader decline in tech stocks after President Donald Trump announced new tariffs of between 10% and 49% on imported goods.

The majority of Apple’s revenue comes from devices manufactured primarily in China and a handful of other Asian countries. Nvidia, which manufactures new chips in Taiwan and assembles its artificial intelligence systems in Mexico and elsewhere, fell about 4%, while electric vehicle company Tesla dropped 4.5%.

Across the rest of the megacap universe, Alphabet, Amazon and Meta all dropped between 2.5% and 5%, and Microsoft was down by almost 2%.

If Apple’s postmarket loss is matched in regular trading Thursday, it would be the steepest decline for the stock since September 2020.

Trump on Wednesday afternoon said the new taxes on imported goods would be a “declaration of economic independence” for the country. He announced a 10% blanket tariff on all imports, and higher duties for specific countries, including 34% for China, 20% for European nations, and 24% for Japanese imports, based on what tariffs they charge on U.S. exports, Trump said.

“We will supercharge our domestic industrial base, we will pry open foreign markets and break down foreign trade barriers,” Trump said during his speech. “Ultimately, more production at home will mean stronger competition and lower prices for consumers.”

Stocks broadly got hit by Trump’s announcements. An exchange-traded fund tracking the S&P 500 slid 2.8%, while an ETF following the Nasdaq 100 lost more than 3%.

During his speech, Trump praised Apple, Meta, and Nvidia for spending money and investing in the United States.

“Apple is going to spend $500 billion, they never spent money like that here,” Trump said. “They’re going to build their plants here.”

The Nasdaq just wrapped up its worst quarter since 2022, dropping 10% in the first three months of the year, though the tech-heavy index rose in each of the first two days of the second quarter.

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