heh 30 billion for a user base that’s fickle and transient and could all move en masse to the Next Big Thing at a moments notice
The EO also bans anyone in the US with doing business with ByteDance, Tencent, or WeChat in 45 days.
Section 1. (a) The following actions shall be prohibited beginning 45 days after the date of this order, to the extent permitted under applicable law: any transaction that is related to WeChat by any person, or with respect to any property, subject to the jurisdiction of the United States, with Tencent Holdings Ltd. (a.k.a. Téngxùn Kònggǔ Yǒuxiàn Gōngsī), Shenzhen, China, or any subsidiary of that entity, as identified by the Secretary of Commerce (Secretary) under section 1© of this order.
b) The prohibition in subsection (a) of this section applies except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or any license or permit granted before the date of this order.
© 45 days after the date of this order, the Secretary shall identify the transactions subject to subsection (a) of this section.
So, um, Tencent owns Funcom.
Not sure 45 days is enough time to figure out the legal mess 45 just created.
Tencent owns or is invested in a number of game companies
Aren’t a bunch of Hollywood movies made with Tencent money? Including the new Top Gun?
I’m not how well that is going to go down. Tencent is a top 10 global and has plenty of commercial interests in the US, with big companies that probably quite like Tencent’s money.
Disclaimer - Trump is an idiot and could change his “mind” – such as it is – at any time.
So is this de facto nationalisation of TikTok? Forcing a foreign company to sell to an American company (at fire sale price), or risk losing almost everything? Isn’t America supposed to be against this sort of communist crap?
You know, I am aware that CCP can order TikTok to spy all and every users on CCP behalf. But two wrongs don’t make a right.
This is extraordinary. All my Chinese colleagues use WeChat. They arent even mainland Chinese, Chinese Malays and Brits with families from HK.
It looks like OFACs 50% rule applies. If any tech/games companies are owned 50% or more they recent they will be cut off from the global financial system. No Western banks will touch them. No funds to or from them. If Tencent owns say 10% of Blizzard then Blizzards banks will be technically fine, the banks might shy away due to compliance and reputational risk. However if Tencent owns 50%+ then that games company won’t be able to accept payments and its banks will exit them.
Daybreak (Sony Verant/EQ Planetside etc) had to fiddle with its ownership when one of its investors Viktor Vekselberg was sanctioned. I think they moved ownership out of Columbus Nova and to some US person, but it wasn’t public info.
The text is wide enough that OFAC will have to explicitly state it doesn’t affect Tencents other subsidiaries in a OFAC FAQ.
any transaction that is related to WeChat by any person, or with respect to any property, subject to the jurisdiction of the United States, with Tencent Holdings Ltd. (a.k.a. Téngxùn Kònggǔ Yǒuxiàn Gōngsī), Shenzhen, China
If you have a US subsidiary of tencent that recieved flow of funds from wechat and tencents other subsidiaries then that entity will be blocked.
They will possibly need to restructure. Banks will still be wary about processing any Tencent transaction. We see stuff bounced back and flagged that are entirely permissible under General Licence but the banks crap themselves at a sniff or hint of sanctions.
- Full ownership of Riot Games, the American developers of Valorant and League of Legends
- Full ownership of Norwegian publisher Funcom.
- Full ownership of Swedish developer Sharkmob, founded in 2017 by ex-Ubisoft developers and fully acquired by Tencent in 2019.
- 80% ownership in the New Zealand company Grinding Gear Games, the developers of the game Path of Exile.
- Approximately 84% ownership in Finnish mobile game developer Supercell, makers of Clash of Clans and Clash Royale
If I was their bank I would’ve demanding independent verification that they have no involvement with WeChat or we exit you. So get on the phone to your lawyers or auditors. Even then, we might have an internal rule that says anything in the ownership chain is sanctioned then exit relationship regardless. The industry is extremely risk adverse with this issue.
Epic is 49%, below the threshold and out of scope.
Let’s be honest, stopping us from playing League of Legends is easily his greatest humanitarian effort.
What an utter shitshow this is going to be.
This should be interesting.
I wonder how much of this is also a favor to Zuckerberg, who is firmly in the Trump camp? Someone posted a tweet the other day about how the top 10 posts of Facebook each day are all Trump propaganda.
Is this ban even legal? Wouldn’t this violate WTO rules?
Can someone explain how Executive Orders are treated as 100% law? I don’t get it.
OFAC just sanctioned most of HKs senior leadership. All these peoples assets held in the West will be frozen and they are excluded from the entire Western banking system, as are any companies they own.
Because Congress is worthless.
They don’t pass laws and they don’t check the executive and now we have a king that passes laws by declaration.
Until the next king shows up and rewrites everything again.
I heard the EU is now considering forcing Alphabet to sell Google to Qwant because US privacy law sucks. Not really, of course, but I guess that’s where we’re heading.
They aren’t, but US laws are often written in broad terms to give executive branch (which includes not just the president but bureaucrats of many different ranks) flexibility in enforcing the laws. If you read the executive order above, you’ll note Trump claims authority under the International Emergency Economic Power Act. I’m pretty sure most executive orders given name a law which gave the President authority.