Cyber Week in Review: December 6, 2024

Court of Appeals upholds law banning TikTok in the United States

On Friday, the U.S. Court of Appeals in Washington, D.C upheld an April bill banning the platform in the United States unless its owner, ByteDance, divests its U.S operations by January 19^th. The three-judge panel determined in a unanimous decision that the potential ban does not violate free speech protections under First Amendment or implicit equal protection guarantees under the Fifth Amendment. The opinion held that national security risks cited by lawmakers were adequate rationale to ban the app. ByteDance will likely appeal the decision to the Supreme Court, although it is not clear that the Court would agree to hear the case. While ByteDance has reportedly explored selling TikTok to a non-Chinese buyer, the Chinese government’s opposition to such a sale has added complexity to that process, as does the vast portfolio of intellectual property underpinning TikTok. If divesture is indeed forced, China will likely push for a non-American buyer, while ByteDance might seek an American subsidiary of a multinational entity, such as Rakuten or Sony. American billionaire Frank McCourt’s Project Liberty initiative has also reportedly raised nearly $20 billion to purchase TikTok and announced its intention to pursue a bid. It is unclear whether the incoming Trump administration would pursue divestiture with the same zeal as the Biden administration if the sale is not finalized before the presidential transition. President-elect Trump signed an August 2020 executive order attempting to ban TikTok, but he has since reversed his position, signaling support for the app during his campaign and recently posting his TikTok campaign statistics on TruthSocial.

United States announces new semiconductor export controls against China

The U.S. Commerce Department’s Bureau of Industry and Security (BIS) imposed a new set of export controls on China’s advanced semiconductor industry earlier this week. The restrictions are aimed at preventing the Chinese government or companies from importing or procuring specialized manufacturing equipment and software used in the production of the most advanced microchips. Specifically, the controls apply to twenty four types of manufacturing equipment and three software tools essential to the manufacture of advanced semiconductors. The restrictions are the latest in a long line of export controls the United States has imposed on China, which expanded significantly in October 2022 when BIS imposed major controls on China’s ability to procure products for its semiconductor and supercomputing sectors. The controls have spurred significant Chinese government investment in the domestic semiconductor industry, and Chinese companies have developed some workarounds that allow them to access advanced semiconductors and manufacturing equipment; the latest BIS order is partly aimed at closing some of the loopholes exploited by these companies. Chinese industry retaliated quickly against the latest restrictions, with four government-backed Chinese trade associations declaring U.S.-made semiconductors “no longer safe or reliable” and urging ”[caution] when purchasing U.S. chips.” The Chinese government reacted similarly, imposing major trade restrictions on the export of the critical minerals gallium, germanium, and antimony, among other metals, to the United States. The metals restricted by the government are frequently used throughout the electronics, defense, and battery industries; and the U.S. Geological Survey estimated in November that if China were able to achieve a complete export ban on gallium and germanium to the United States, it could reduce U.S. gross domestic product by $3.4 billion.

Australia bans children under 16 from social media

The Australian government has banned children under 16 from using social media in a law set to take effect next year, establishing one of the strictest national-level measures against children’s use of social media in the world. Under the law, platforms designed primarily to “enable online social interaction,” can be fined up to 50 million Australian dollars (~$33 million USD) for failure to prevent children from creating and using accounts. Children who use social media platforms will not be subject to penalty under the law. The law does not stipulate actions platforms must take to keep children off their services and industry experts have pointed to the lack of any clear methodological as evidence that the law is overbroad. The law, which advocates say will improve children’s mental health, does not apply to all platforms equally. Communications Minister Michelle Rowland, who is responsible for enforcing the law, said that platforms such as Snapchat, TikTok, Instagram, and X would be banned for minors, while other platforms, including YouTube, would be exempted because they do not require users to create an account. Similar efforts are underway in other countries, too: this fall, Norway announced plans to ban kids under 15 from using social media, while France is testing a smartphone ban for kids under 15 in a limited number of schools.

India introduces new cybersecurity regulations for telecommunications networks

India recently rolled out regulations for telecommunications companies, allegedly in order to protect critical infrastructure and telecommunications networks. The regulations require telecommunications companies to report cybersecurity incidents within six hours of detecting them, share user traffic data with cybersecurity authorities, and adopt a cybersecurity policy that includes risk management approaches, training, network testing and risk assessment. Experts have raised concerns over the amount and type of data sharing required under the regulation, as well as the ambiguous definition of “traffic data” in the legislation, particularly given the previous use of social media laws to compel social media platforms to censor content and crack down on political dissent. Cybersecurity controls in telecommunications networks have become a prominent topic in recent weeks, as a Chinese threat actor, Salt Typhoon, breached telecommunications networks in the United States and dozens of other countries and stole untold amounts of highly sensitive data.

Poland arrests former spy agency leader for role in spyware scandal

Polish authorities detained Piotr Pogonowski, the former head of Poland’s internal security agency, the ABW, and ordered him to testify before Parliament over his role in the previous government’s use of Pegasus spyware against opposition politicians, journalists, and prosecutors. Pogonowski had been summoned to appear before the parliamentary committee investigating the use of Pegasus three times, but he had refused to testify and called the inquiry “illegal.” According to experts, this marks the first time in modern Polish history that a witness has been arrested and compelled to testify in front of Parliament. The previous ruling party, the Law and Justice (PiS) party, allegedly used government funds to purchase Pegasus spyware and deploy it against opposition politicians, including a sitting senator, Krzysztof Brejza, and former PiS Members of Parliament. Pognowski was reportedly instrumental to the effort, with the ABW deploying Pegasus against a number of targets at the behest of PiS leader Jarosław Kaczyński. Since PiS fell out of power in December 2023, the new government, led by Prime Minister Donald Tusk, has aggressively pursued an investigation into the use of Pegasus by PiS: earlier this year, Polish prosecutors charged Michał Woś, a former officials in the Polish Justice Department, with misappropriation of funds for diverting money to purchase Pegasus.

Maya Schmidt is the intern for the Digital and Cyberspace Policy Program.