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WeChat shuts down the impact of new Trump sanctions



The CEO of Tencent (the parent company of WeChat) James Mitchell prefers to minimize the effects of the new US sanctions imposed on the Chinese messaging application and the social network TikTok. According to the latter, blocking the application would only affect 2% of WeChat’s sales.

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Just like TikTok, the Chinese messaging app WeChat is targeting a new presidential decree. This was signed on Friday, August 7, 2020, obliging US companies to terminate all relationships with WeChat and TikTok after a period of 45 days, under the guise of national security. In fact, this may allow the Trump administration toorder removal of these apps from the Google Play Store and App Store.

WeChat wants to believe that sanctions will not apply to Apple in China

As Tencent CEO James Mitchell notes, In fact, WeChat’s operations in the United States account for only 2% of the app’s revenue. A confirmation that does not seem to be empty words. In their latest results, the Tencent group announced a 37% profit increase. It remains to be seen whether the ban on WeChat will cover the Play Store and App Store outside the United States, especially in China.

Apple’s operations in China (about $ 44 billion a year) could really be severely affected if Chinese users could not use WeChat – or its Chinese counterpart Weixin. From this point of view, the Presidential Decree is rather vague. He forbids “Any transaction in connection with WeChat by any person or in respect of any property under the jurisdiction of the United States, with Tencent Holdings Ltd. (aka Téngxùn Kònggǔ Yǒuxiàn Gōngsī), based in Shenzhen, China or any subsidiary of this entity ”.

James Mitchell wants to believe in minimal impact: “If you analyze the presidential decrees signed since May 2019 as well as the obvious decree that was signed a few days ago, they very clearly specify that they cover US jurisdiction, which means that we do not see any effects on companies marketing our platform in China.” .

Read also: TikTok – CNIL opens an investigation of the application after submitting a complaint

An optimism that still conflicts with the Huawei case. For it must be seen that the White House in this case has succeeded with the help of presidential decrees to give an extraterritorial effect on its sanctions. Goes so far as to prevent foreign suppliers from making Kirin chips for the group.

Source: BBC


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