Yes, there is a distinction there. The issue is that it's a small part of the overall problem when looked at the larger scale. The overarching issues of political influence at odds with individual citizens, hostile engagement-maximizing algorithms, adversarial locked-down client apps, and selling influence to the highest bidder are all there with domestically-incorporated companies. The government's argument basically hinges on "but when these companies do something really bad we can force domestic companies to change but we can't do the same for TikTok". That's disingenuous to American individuals who have been on the receiving end of hostile influence campaigns for over a decade, disingenuous to foreign citizens not in the US or China who can't control any of this, and disingenuous to our societal principles as we're still ultimately talking about speech.