The court will hear oral arguments on Jan. 10, 2025.

TikTok had challenged the divestment law as unconstitutional under the First Amendment, and a three-judge panel in federal court had upheld the law earlier this month.

TikTok then appealed to the high court asking for a pause of the Jan. 19 deadline and asking it to treat its petition as one for review.

The Supreme Court wrote on Dec. 18 that it will hear arguments in the case before deciding whether to pause the deadline.

When President Joe Biden signed the Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACA) into law, it started a 270-day countdown for ByteDance to divest of TikTok or else stop operating the app in the United States. The law targets apps owned or controlled by foreign adversaries, in this case, the Chinese communist regime.

The law also allows the president to issue a one-time extension of a maximum of 90 days.

President-elect Donald Trump has suggested he can facilitate a sale of TikTok, which would prevent what TikTok calls a “ban.” TikTok is arguing the deadline should be paused so the new administration can make the call.

The Justice Department argued the law did not violate the First Amendment because it targeted ownership by a foreign adversary for national security reasons, and that it did not target content.

The Supreme Court directed parties to argue on “whether the Protecting Americans from Foreign Adversary Controlled Applications Act, as applied to petitioners, violates the First Amendment.”

The parties have a Dec. 27 deadline to file opening briefs, and a Jan. 3, 2025, deadline for reply briefs. Amicus briefs have a Dec. 27 deadline. Oral arguments will last two hours.

This is developing and will be updated.

“We need to start changing behaviors on the other side rather than just having this escalation of their offense and our defense,” Waltz said on CBS’s “Face the Nation” on Sunday.

Waltz said President-elect Donald Trump as well as his pick for U.S. secretary of state, Sen. Marco Rubio (R-Fla.), are on the same page in terms of starting to “impose costs on the other side to get them to knock this off.”

U.S. officials and law enforcement have on multiple occasions named the Chinese communist regime as a persistent and top cyber threat to the United States.

Waltz pointed to several high-profile incidents like ransomware attacks and the “Volt Typhoon“ campaign wherein the FBI says Chinese state-backed hackers have gained access to critical infrastructure like energy grids and water systems.

With large-scale campaigns like Volt Typhoon and a similar “Salt Typhoon,” in which Chinese state-backed hackers gained access to American telecoms networks to steal communications from targeted individuals, the hackers still have access.

Waltz said the United States needs not only to shore up defenses but also impose real consequences.

“We need to start going on offense and start imposing higher costs and consequences,” he said.

The private sector has a role to play as well, Waltz said.

“We’ve got a tremendous private sector,” he said. “Our tech industry, they could be doing a lot of good in helping us defend [the United States], but also making our adversaries vulnerable.”

Experts have similarly recommended a stronger cyber response. The Senate held a hearing on Chinese cyber espionage on Dec. 11, during which experts pointed out that the United States has not punished foreign actors for their malicious cyber activity.

Outgoing FBI head Christopher Wray—who sounded the alarm over the Volt Typhoon campaign last year and has since made speeches internationally on the issue and testified before Congress on the Chinese cyber threat—said that while the FBI managed to remove Volt Typhoon malware from critical systems, hackers remain prepositioned to do widespread damage. He also testified that Chinese cyber actors outnumber those of the FBI by 50 to one.

Intelligence officials and private companies have also noted that while the Chinese regime makes use of the entire state apparatus to target the United States, American companies and the government work independently. In some cases, the Chinese state-backed campaigns focus on civilian targets.

Last week, the State Department put up a $10 million reward for information leading to the location of individuals who have participated in malicious cyber activities targeting U.S. critical infrastructure under the direction of a foreign government.

The proposed change to the tax code is meant to dissuade American businesses and funds from supporting the Chinese Communist Party (CCP), which lawmakers and the intelligence community have increasingly warned is a national security risk in recent years.

“For too long, Americans investing in China’s military-industrial complex have been given unfair tax breaks that allow them to profit from funding our adversary,“ Moolenaar stated in the announcement. ”Our nation’s tax code should be incentivizing investment in the United States, not collaboration with the CCP.”

Capital gains tax policy allows for the deferment of paying taxes for profit on an investment. It’s meant to encourage investment, and currently has no location-based restriction. The bill, titled the Patriotic Investment Act, targets investments with ties to the CCP, and specifically notes it doesn’t apply to Taiwan.

Chinese investments would instead be taxed at the highest income rate. If the bill is passed into law, companies would have six months to divest from China before the new rate kicks in, and can pay in three installments.

“The Capital gains tax rate was meant to encourage investment in American innovation, not fund an oppressive communist regime,“ Rubio stated. ”But Wall Street continues to give money to our adversaries and reap rewards from the American tax system. Enough is enough.”

In addition to national security concerns, the lawmakers noted that the CCP pours “hundreds of billions of dollars” into enterprises to maintain its military, which aids its persecution of ethnic and religious minority groups via torture and slave labor, and violates international trade rules in a way that has “dismantled” American industries, businesses, and jobs.

The bill comes a day after Moolenaar previewed the action at a talk at the American Enterprise Institute, calling divestment from the CCP a “No. 1 priority.”

China, the world’s second largest economy, is currently facing an economic crisis, with record levels of foreign investment pulling out.

Still, its economy is deeply intertwined with international supply chains, and Chinese companies, most of which have CCP ties, still supply critical components to American companies, even in competitive industries.

When the White House earlier this week proposed a ban on Chinese software and firmware for connected vehicles, the Commerce Department noted that implementation would need to be delayed until 2027 because American manufacturers have said that they do not know where all of their parts components originate and the new due diligence processes will be complex.

In the chip industry, the United States has taken many steps to block China’s access to advanced semiconductors, but China is still a top exporter of larger chips, and American companies still depend on them.