October 9, 2019 / 6:43 PM / 6 days ago

REFILE-UPDATE 1-U.S. Senator Rubio calls for review of TikTok's merger with Musical.ly

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Oct 9 (Reuters) - U.S. Senator Marco Rubio on Wednesday said he will ask the Committee on Foreign Investment in the United States (CFIUS) to review TikTok owner Beijing ByteDance Technology Co’s acquisition of Musical.ly.

"Today I will be asking CFIUS to review TikTok's acquisition of Musical.ly. Ample & growing evidence exists that TikTok's platform for western markets, including the U.S., are censoring content in line with China's communist government directives," the Republican senator said here in a tweet.

ByteDance, one of China’s fastest growing start-ups, owns the country’s leading news aggregator Jinri Toutiao as well as Tiktok, which has attracted celebrities like Ariana Grande and Katy Perry along with legions of U.S. teenagers.

The company’s Chinese ownership and sudden spike in popularity have raised national security concerns among U.S. lawmakers, who are still reeling from revelations that Russia used social media platforms to meddle in the 2016 U.S. presidential election.

Congress cannot compel CFIUS to review individual cases, but the powerful committee does have jurisdiction to review previously un-notified transactions in perpetuity.

Chinese gaming company Beijing Kunlun Tech Co Ltd earlier this year agreed to a request by CFIUS to sell popular gay dating app Grindr, which it had owned since 2016.

Kunlun drew U.S. ire after it gave some Beijing-based engineers access to personal information of millions of Americans such as private messages and HIV status.

ByteDance bought Musical.ly for nearly $1 billion in December 2017. It later shuttered Musical.ly and moved users to a revamped version of its own app TikTok, which serves non-Chinese markets.

Musical.ly, released in 2014, and TikTok, launched in 2016, both enable users to create and share short singing and dancing videos that are set to well-known songs, with numerous special effect filters.

The company’s original app Douyin is similar to TikTok, but is only available in China and complies with local censorship requirements.

ByteDance counts venture firm Sequoia Capital and big private-equity firms such as KKR, General Atlantic and Hillhouse Capital Group as backers, sources have told Reuters.

Reporting by Shubham Kalia in Bengaluru, Katie Paul in San Francisco and Alexandra Alper in WashingtonEditing by Chris Reese and Cynthia Osterman

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