On Thursday, TikTok, a Chinese-owned video app, said that it is going to set up its first European data center in Ireland amid the threats of a ban from the U.S. The company already has a hub that deals with regional regulatory issues. Now it will further help it to extend its presence globally.
Recently, ByteDance, TikTok’s parent company, said that they were considering moving their headquarters overseas. TikTok’s decision to invest 420 million euro or $499 million in Ireland came at a time when relations between China and the West have intensified due to disagreements ranging from trade to the handling coronavirus.
Many lawmakers in the U.S. along with President Trump said that the Chinese company is a national security risk. Additionally, Trump has also openly said that he will ban the app from the U.S. on Sept. 15 in case its U.S. operations are not sold to Microsoft.
In the past few years, Ireland has become Europe’s largest hub for data centers. In Ireland, foreign firms account for one in 10 Irish jobs due to a low corporate tax rate. It hosts operations for major tech companies including Facebook, Alphabet Inc’s Google, and Amazon.
TikTok’s data center will not only enhance its capability globally but also create more jobs. It will signal its long-term commitment to Ireland, Roland Cloutier, global chief information security officer wrote.
TikTok said that it’s Irish and UK entities will take over management and safeguarding of the personal data of its European users from its U.S. business.
In a statement, Martin Shanahan, head of the Irish state agency responsible for attracting foreign investment, said “TikTok’s decision to establish its first European data center in Ireland is very welcome and positions Ireland as an important location in the company’s global operations.”