Video steaming app TikTok has suspended talks to build a global headquarters in Britain, after Communist Party officials warned UK companies doing business in China of retaliation over London’s to stop working with Huawei on its 5G network.
The Sunday Times reported that ByteDance Ltd, parent company of the video app, had been in talks with officials from the Department for International Trade and with Prime Minister Boris Johnson's Downing Street office for several months. The new base was set to create 3,000 jobs.
TikTok has 800 million users worldwide, mainly teenagers, but critics warn of the security risks due to its links to the Chinese states. India imposed a ban on the app last month, while the United States is mulling one. However, TikTok could break away from its Chinese parent to evade a US ban, a top White House adviser said Thursday.
The report suggests the fallout from the UK decision to ban Huawei from its next-generation wireless network could amount to more than just a diplomatic spat. The government is trying to revive Britain’s reputation as a country open for business following its departure from the European Union, while China has warned Mr Johnson it will face consequences if the UK treats it as a “hostile partner.”
In a separate report that may irk the White House, the Observer newspaper said the government privately told Huawei the decision stemmed partly from US pressure. British officials reportedly gave the impression that it could be reviewed if President Donald Trump fails to win a second term.
Secretary of State Mike Pompeo is set to visit London on Monday, with China and a US-UK trade deal among the topics up for discussion.
Britain has instead asked Japan for help with its 5G network, Nikkei reported on Saturday. British officials told their counterparts in Tokyo that Japanese technology companies NEC and Fuhitsu may replace the Chinese tech giant.