The announcement came on Wednesday as Canadian officials cited potential risks associated with TikTok’s parent company, ByteDance, which is based in China.
While the government has not restricted Canadians from accessing TikTok or creating content on the platform, the decision underscores growing worries about the app’s data privacy and security implications.
Many governments worldwide are scrutinizing the potential influence and data-gathering practices of apps connected to foreign entities, particularly those with ties to China.
By mandating the dissolution of TikTok’s business operations within Canada, officials aim to reduce potential national security vulnerabilities without infringing on users’ access to the popular platform.
“The government is taking action to address the specific national security risks related to ByteDance Ltd’s operations in Canada through the establishment of TikTok Technology Canada Inc,” Innovation Minister Francois-Philippe Champagne said in a statement.
Ottawa last year began reviewing TikTok’s plan to invest and expand its business in Canada.
Under Canadian law, the government can assess potential risks to national security from foreign investments, such as the TikTok proposal.
The law prevents the government from revealing the details of such investments.
“The decision was based on the information and evidence collected over the course of the review and on the advice of Canada’s security and intelligence community and other government partners,” Champagne added.
TikTok said it would challenge the order in court.
“Shutting down TikTok’s Canadian offices and destroying hundreds of well-paying local jobs is not in anyone’s best interest, and today’s shutdown order will do just that,” a TikTok spokesperson said in a statement.
Canada has banned the TikTok app from government-issued devices, saying it presents an unacceptable level of risk to privacy and security.
TikTok and ByteDance sued the United States federal court in May, seeking to block a law signed by President Joe Biden on April 24 which gave ByteDance until January 19 to sell TikTok or face a ban.
The White House said it wanted to end Chinese-based ownership in the state, citing national security, explaining that the ban was not on TikTok.
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