TikTok Shatters Lobbying Records with a 326% QoQ Surge Amid Increased Scrutiny on China Links

ByteDance, the parent company of TikTok, has witnessed a notable 326% surge in its lobbying expenditure from Q3 2022 to Q3 2023. This is according to an analysis by Stocklytics.com. The firm’s federal lobbying now stands at approximately $7.4 million.

The company has significantly increased its lobbying efforts amidst growing scrutiny of the video-sharing app. 

Stocklytics Financial analyst remarked on the data:

ByteDance has set new records by pouring unprecedented sums into federal lobbying. They have spent more in the first three quarters of 2023 than any prior year. In Q3 2023 lobbying activities, the firm also marked a historic high, with over $3.7 million spent. This set a new company record for federal lobbying in a single quarter.

Stocklytics Financial analyst, Edith Reads

Top-Performing Lobbying Firm

A TikTok spokesperson attributed the higher expenditure to a unique settlement of Restricted Stock Units as part of employee compensation. 

ByteDance faced increased attention in the last quarter due to changes in stock grant rules and a significant stock buyback plan. This further lowered its valuation despite profitability.

As TikTok faces a nationwide push for a ban and increased scrutiny, ByteDance is actively engaged in lobbying efforts. These efforts focus on Internet technology, data security, privacy legislation, and trade issues affecting Internet companies.

The company ranked thirteenth among all federal lobbying clients in Q3 2023, surpassing major players like Google parent Alphabet Inc. and Twitter.

TikTok’s China Ties 

TikTok has become a symbol in countering China’s influence in the U.S., with Senator Marsha Blackburn labelling it a “Chinese Communist Party surveillance tool.” 

Criticism from lawmakers includes allegations that TikTok shares American users’ data with the Chinese Communist Party. Senate hearings in 2021 and 2022 saw executives grilled over Chinese government influence and access to American users’ data. 

Despite claims by TikTok COO Vanessa Pappas that ByteDance isn’t based in China, the app is reportedly controlled by staff in ByteDance’s Beijing headquarters. 

TikTok CEO Shou Zi Chew is set to testify before the House Energy and Commerce Committee on Jan. 30. He will address concerns about the company’s relationship with the Chinese government.

ByteDance’s lobbying team also actively opposed the Protecting Kids on Social Media Act. This is a bipartisan bill restricting social media use for individuals under 13. 

The company has strategically enlisted former members of Congress. This includes Senators Trent Lott and John Breaux, as well as Representatives Jeff Denham, Bart Gordon, and Joe Crowley to advocate on its behalf. 

As the scrutiny on TikTok intensifies, ByteDance’s lobbying activities indicate a proactive approach to navigating regulatory challenges and influencing policy decisions at both federal and state levels.