TikTok files legal challenge of Canada’s shutdown order

TikTok is challenging the federal government’s order to shut down its operations in Canada, claiming it will eliminate hundreds of jobs and potentially terminate a quarter of a million contracts that it has with Canadian advertising clients. 

The company filed documents in Federal Court in Vancouver on Dec. 5, seeking to set aside the order to wind-up and cease business in Canada. 

The government ordered the dissolution of TikTok’s Canadian business in November after a national security review of the Chinese company behind the social media platform.

That means TikTok must close its operations in Canada, though the app will continue to be available to Canadians.

TikTok wants the court to pause the order while it argues its case on why the government’s decision should be overturned. 

It claims the minister’s decision was “unreasonable” and “driven by improper purposes.”

“TikTok Canada provides hundreds of Canadians with well-paying jobs, and contributes millions of dollars annually to the Canadian economy,” the application says. “Through the TikTok platform, Canadian businesses and content creators can reach a global audience of over one billion monthly users.”

The review was carried out through the Investment Canada Act, which allows the government to investigate any foreign investment with potential to harm national security.

Industry Minister François-Philippe Champagne said in a statement at the time that the government was taking action to address “specific national security risks,” though it didn’t specify what those risks were.

TikTok’s court application says Champagne “failed to engage with TikTok Canada on the purported substance of the concerns that led to the (order.)”

The company argues the government ordered “measures that bear no rational connection to the national security risks it identifies.”

It says the reasons for the order “are unintelligible, fail to reveal a rational chain of analysis and are rife with logical fallacies.”

TikTok Canada also claims it “participates in important Canadian public policy issues at the federal and provincial level, including those related to online safety, elections, and culture.”

The company’s filing says TikTok Canada “worked with Elections Canada and the Privy Council Office on partnerships to support election integrity on the TikTok platform.” 

TikTok claims the foreign investment review and economic security branch of Innovation, Science and Economic Development Canada “abruptly” finished the company’s national security review at the end of October, and ordered the company to wind-up its Canadian operations a week later. 

The company’s court application says there were “less onerous” options available than ordering the shut down, which it claims “will cause the destruction of significant economic opportunities and intangible benefits to Canadian creators, artists and businesses, and the Canadian cultural community more broadly.” 

The company’s law firm, Osler Hoskin & Harcourt LLP, declined to comment, while Champagne’s office did not immediately respond to a request for comment.

A TikTok spokesperson said in a statement that the order would “eliminate the jobs and livelihoods of our hundreds of dedicated local employees — who support the community of more than 14 million monthly Canadian users on TikTok, including businesses, advertisers, creators and initiatives developed especially for Canada.”

This report by The Canadian Press was first published Dec. 10, 2024.