The long-going dispute regarding TikTok may just have entered its final stages – the US and China have reached a framework agreement concerning the ownership of TikTok, potentially averting a ban on the popular social media platform in the country. The deal was announced following trade talks in Madrid, with US Treasury Secretary Scott Bessent confirming that the agreement would facilitate a transition of TikTok to US ownership. Specifics were no revealed at the moment, and the deal is subject to final approval by both Us President Donald Trump and Chinese President Xi Jinping, who are scheduled to discuss the matter on Friday. This development represents the latest stage of a drawn-out battle over TikTok, which has been under scrutiny in the US for years due to national security concerns about its Chinese parent company, ByteDance.
The framework agreement addresses national security concerns that have been raised regarding TikTok’s Chinese ownership. Earlier, the US Congress passed the Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACA), which mandated that ByteDance divest from TikTok by January 19, or face a nationwide ban. Although the ban was enacted in January, enforcement had been postponed multiple times to allow for negotiations. PAFACA granted broad enforcement authority to both the Department of Justice and the Committee on Foreign Investment in the United States (CFIUS), requiring divestiture or operational restructuring of apps deemed controlled by foreign adversaries.
“We were very focused on TikTok and making sure that it was a deal that is fair for the Chinese and completely respects US national security concerns, and that’s the deal we reached,” Bessent said.
President Trump further suggested that a deal was imminent, stating on social media that trade talks with China had “gone very well” and hinting at a resolution regarding TikTok’s ownership. However, Chinese officials have not yet publicly confirmed the details of the agreement. China’s Ministry of Commerce has, in past cases, criticized forced technology divestments as violations of fair competition and has its own regulatory levers to block the transfer of TikTok’s algorithms, which were declared “restricted technologies” under a 2020 export control list.
“The big Trade Meeting in Europe between The United States of America, and China, has gone VERY WELL! It will be concluding shortly. A deal was also reached on a “certain” company that young people in our Country very much wanted to save. They will be very happy! I will be speaking to President Xi on Friday. The relationship remains a very strong one!!! President DJT” Trump wrote in a post on Truth Social.
The outcome of the negotiations could have major implications for TikTok’s operations in the US. With over 135 million active users in the country, the platform has become a central player in the social media landscape. The potential transition to US ownership may address national security concerns while allowing TikTok to continue its operations. It is likely that the transition could result in changes in performance, user engagement, and advertising revenue. TikTok is generally considered to be the flagship product of ByteDance, valued at over $250 billion, and its divestiture could reshape its global strategy. Meanwhile, American firms like Oracle, Microsoft, and private equity groups have been floated as possible buyers, though none have publicly confirmed their bids.
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