It will be interesting to see how this plays out...
Opinion: Trump has no right to demand money from Microsoft-TikTok deal
marketwatch.com
Published: Aug. 4, 2020 at 3:59 p.m. ET
The fact that Trump seems to think that the U.S. government is acting as an investment banker in this possible match-up is a new level of delusion. Finder’s fees may be a core component of how real estate works, but not the federal government.
“There is zero legal authority for the president to extort money from a company seeking to clear a deal under the laws creating CFIUS,” John Coates, a professor of law at Harvard University, said in an email. “Congress has never authorized an executive branch official, or any agency, to condition regulatory approval or clearance on the payment of the ‘cut’ of a deal, a ‘finder’s fee,’ or a bribe. The fact that the money might in theory go into the U.S. Treasury does not make it legal. Congress, and only Congress, can authorize taxes, through legislation.”
The president’s decree that TikTok must sell or stop operating appears to be on sounder legal ground. CFIUS, or the Committee on Foreign Investment in the U.S., is a committee under the Treasury Department that analyzes cross-border transactions. Trump has used powers related to CFIUS before in blocking Broadcom Inc. AVGO, +2.22% from acquiring Qualcomm Corp. QCOM, +1.24% , and predecessors used it to block Chinese acquisitions of chip companies and other transactions, saying those deals threatened national security. |
