The US government is forcing a private Chinese firm, Beijing Kunlun Tech, to divest itself of Grindr, a location-based meetup app for the LGBTQ community which Kunlun finished acquiring in 2018.
Grindr arranges its 27 million users (as of 2017) based on their physical proximity to one another.
It handles intensely personal data: users’ location down to the metre, their intimate photos, sexual preferences, chat records, and even HIV status.
The Committee on Foreign Investment in the US [Cfius] is concerned China’s government may access this data—particularly that of U.S. intelligence or military personnel who use the app, Reuters reports.
Normally, Cfius reviews mergers which might give foreign entities outsize control over American businesses and potentially pose a national security threat.
But Cfius’s review process depends on foreign companies voluntarily submitting their acquisition proposals—which Kunlun did not do.
Kunlun responded to US pressure by switching gears, offering Grindr up for auction rather than launching its Initial Public Offering.
Legality aside, Cfius’s move could cause backlash, with states around the world citing national security to coerce private companies into relinquishing ownership of non-native entreprise.
When should states pressure foreign firms into giving up their products?
Credit for this article's header image goes to Getty.