The administration is rethinking a full ban of the app.
What you need to know
- The Trump administration is walking back a full ban of WeChat.
- Officials are instead looking at a partial ban for U.S. users only.
- Apple would still be able to offer the app in the Chinese App Store.
The Trump administration may be walking back its ban on WeChat.
Reported by Bloomberg, senior administration officials have been reaching out to a number of U.S. companies, including Apple, to reassure them that they will still be able to do business with WeChat in China.
In recent days, senior administration officials have been reaching out to some companies, realizing that the impact of an all-out ban on the popular app, owned by China’s Tencent Holdings Ltd., could be devastating for U.S. technology, retail, gaming, telecommunications and other industries, people familiar with the discussions said.
Trump had previously announced that U.S. companies would be blocked from doing business with Tencent, the company behind WeChat. Apple in particular could see a major financial impact from such a ban as a fifth of its sales come from the country. The report also notes that, if China retaliated, it could impact Apple’s manufacturing, most of which reside in the country.
Craig Allen, president of the US-China Business Council, says that their group is “talking to everyone who will listen to us … WeChat is a little like electricity. You use it everywhere.” The group is lobbying on behalf of companies like General Motors and Walmart and attempting to show the administration how devasting a ban of the app would have on American companies.
According to those familiar with the matter, aides in the administration are aiming towards a partial ban of WeChat. This would theoretically prevent the download or update of WeChat in the United States but still allow companies like Apple to offer it in the Chinese App Store. Such a move, while better than an outright ban, would still cut off the ability of American and Chinese iPhone users to communicate to each other using the app unless they already had it downloaded before the ban was to go into effect.
The officials expect that WeChat won’t completely vanish in the U.S., but their aim is to prohibit any downloads or updates of the app in the country, according to three of the people … A partial WeChat ban could mean that companies like Apple could offer it in their China app stores and businesses like Starbucks Corp. could continue to sell coffee or accept payment via the app in China. The intention is to prohibit any downloads or updates of the WeChat app from U.S. app stores, two of the people said.
Apple, the Treasury Department, the White House, and Tencent all either declined or did not respond to requests to comment by Bloomberg.