Chinese-owned video app TikTok, facing the threat of a US ban, said on Thursday it will set up its first European data centre in Ireland, extending its presence in the country where it already has a hub dealing with regional regulatory issues.
The move comes days after parent company ByteDance said it was considering moving TikTok's headquarters overseas, following a British media report that the unit could relocate to London.
TikTok's EUR 420 million (roughly Rs. 3,728 crores) investment in Ireland comes at a fraught time in relations between China and the West, with disagreements on a range of issues from trade and the handling of the coronavirus to the political situation in Hong Kong.
US President Donald Trump and other American lawmakers have said the company is a national security risk and Trump has said he will ban the service in the United States on September 15 if its U.S. operations are not sold to Microsoft.
Ireland is one of Europe's biggest hubs for data centres and already hosts operations for major technology companies such as Amazon, Facebook, and Alphabet's Google.
TikTok's data centre will create hundreds of jobs, enhance TikTok's global capability and signals its long-term commitment to Ireland, global chief information security officer Roland Cloutier wrote in a blog post.
Foreign firms directly account for one in 10 Irish jobs, attracted by a low corporate tax rate. TikTok's "Trust and Safety Hub", set up in Dublin in January, deals with regulators and governments in Europe, the Middle East and Africa.
It also moved its privacy oversight of European users to Ireland in June and TikTok said its Irish and UK entities will take over from its US business in managing and safeguarding the personal data of its European users.
"TikTok's decision to establish its first European data centre in Ireland is very welcome and positions Ireland as an important location in the company's global operations," Martin Shanahan, head of the Irish state agency charged with attracting foreign investment, said in a statement.
© Thomson Reuters 2020