President Donald Trump has signed an executive order banning transactions with eight Chinese apps including Alipay and WeChat Pay in an escalation of a trade war that has been unfolding through most of his term.
The order, however, goes into effect in 45 days, nearly a month after Joe Biden will be inaugurated as the next president, so the fate of Trump’s action is unclear.
The orders follow two others Trump signed in August banning dealings with the popular video app TikTok as well as the main WeChat messaging app. The fate of those apps in the U.S. is still unclear, and with just 15 days left until Inauguration Day, it will likely fall to Biden to deal with them — or not.
The president said in the order that the apps can access private information from their users.
That information could be used to “track the locations of Federal employees and contractors, and build dossiers of personal information”, he said.
The order instructs Commerce Secretary Wilbur Ross to evaluate other apps that could pose a “national security threat”.
The Trump administration has targeted Chinese-owned social media applications, claiming that they pose a national security risk to the American public.
In August, Trump issued two executive orders banning TikTok, a popular video-sharing app owned by Chinese company ByteDance, and social networking app WeChat, which belongs to Tencent.
Both orders have faced legal challenges.
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The Trump administration envisions the scope as being similar to the prior orders and does not anticipate it impacting employee payroll, a senior administration official said. But the officials did not answer a question about whether it would affect individual payments between users of the platforms.
Still, Trump’s order, which cites concerns that the platforms threaten national security, has the potential to significantly disrupt international commerce.
Senior administration officials said they believe the move could help stop the encroachment of Chinese data collection and prevent personal information like texts, calls, and photos from being gathered by an adversary.
But they didn’t identify specific instances of data theft using the applications.
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President Trump has signed a new executive order prohibiting transactions with the companies behind eight Chinese apps, including Ant Group’s Alipay and Tencent’s QQ and WeChat Pay. Transactions will be prohibited in 45 days. Reuters was the first to report the news.
The full list of apps includes: Alipay, CamScanner, QQ Wallet, SHAREit, Tencent QQ, VMate, WeChat Pay, and WPS Office.
“The pace and pervasiveness of the spread in the United States of certain connected mobile and desktop applications and other software developed or controlled by persons in the People’s Republic of China…
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It’s not clear whether the order could be applied to transactions outside the U.S. — Starbucks Corp., for example, allows customers to pay with WeChat Pay in China. Alibaba and Tencent shares rose more than 2% on Wednesday in Hong Kong.
TikTok, Hong Kong and More U.S.-China Flashpoints: QuickTake
Of the groups named in Trump’s order, document-management app CamScanner was the most downloaded in 2020 with 4.4 million installs, according to research firm SensorTower.
That surpassed Tencent’s WeChat — the social media service used by over a billion Chinese — which chalked up 1.6 million downloads last year. The order also targeted WeChat and QQ Wallet, the digital wallets built into Tencent’s two largest platforms of the same name.
Alipay, the service that grew out of Alibaba’s immense e-commerce operation, managed just over 207,000 downloads in 2020.
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The trade war with China homes in on the country’s thriving digital payments industry.
With just two weeks left in office, President Donald Trump has sent out a new executive order targeting Chinese payment apps.
The Tuesday order bars United States citizens or people located in the U.S. from using nine Chinese payment apps. It continues the White House’s earlier efforts to cut off the U.S.
market from Chinese-owned apps like TikTok. Yesterday’s order repeats earlier concerns of data collection by the Chinese Communist Party:
“The continuing activity of the PRC and the CCP to steal or otherwise obtain United States persons’ data makes clear that there is an intent to use bulk data collection to advance China’s economic and national security agenda.”
The apps targeted are AliPay, CamScanner, QQ Wallet, SHAREit, Tencent QQ, VMate, WeChat Pay and WPS Office.
State Department had submitted a proposal to add Ant Group to a trade blacklist in order to deter U.S. investors from taking part in its lucrative initial public offering. But the Commerce Department, which oversees the blacklist, shelved the proposal after Alibaba Group Holding Inc President Michael Evans urged Ross to reject the bid.
Ant is China’s dominant mobile payments company, offering loans, payments, insurance and asset management services via mobile apps.
It is 33% owned by Alibaba and controlled by Alibaba founder Jack Ma, but is currently unavailable for American users.
Alipay was downloaded from Apple’s U.S.
QQ Wallet and WeChat Pay as well.
The order also names CamScanner, SHAREit, Tencent QQ, VMate which is published by Alibaba Group subsidiary UCWeb, and Beijing Kingsoft Office Software’s WPS Office.
“By accessing personal electronic devices such as smartphones, tablets, and computers, Chinese connected software applications can access and capture vast swaths of information from users, including sensitive personally identifiable information and private information,” the executive order states.
Such data collection “would permit China to track the locations of federal employees and contractors, and build dossiers of personal information,” the document adds.
China will take necessary measures to safeguard the legitimate rights of companies in view of the Trump order, foreign ministry spokeswoman Hua Chunying told a regular briefing on Wednesday, adding that the U.S.
Chinese data collection efforts.
“The Chinese government requires that all commercial companies, big and small, support the Chinese Communist Party’s political objectives,” National Security Advisor Robert O’Brien said in a statement.
Commerce Secretary Wilbur Ross issued a separate statement saying he has directed his department to carry out the order. “I stand with President Trump’s commitment to protecting the privacy and security of Americans from threats posed by the Chinese Communist Party,” he said.
The 45-day timeline mirrored a similar period in the WeChat and TikTok executive orders, according to one of the officials who briefed reporters on the condition of anonymity, and there was no consideration of accelerating the implementation before the end of the administration.
Ant’s signature app has mainly focused in the U.S. on places where Chinese consumers visit and shop, such as luxury stores in New York or tourist destinations in California. But in 2019, Alipay inked deals with retailers like drugstore chain Walgreens, placing the app’s logo in front of millions more U.S.
consumers.
“The new Executive Order is similar to, but appears to be more broadly worded, than last year’s Executive Orders targeting transactions in respect of WeChat and TikTok,” said Nicholas Turner, a lawyer at Steptoe & Johnson LLP in Hong Kong. “The ultimate scope of the restrictions and the entities that will be targeted is hard to predict.
