TikTok may have just dodged another ban after the U.S. and China reached a breakthrough deal to keep the social media platform running. Treasury Secretary Scott Bessent met with Chinese officials in Madrid this week, finalizing what both sides are calling a “framework agreement” to overhaul TikTok’s U.S. operations.
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Details of the deal
The Wall Street Journal reported that under the deal, TikTok’s American business would transfer to a new U.S.-based entity. A group of prominent investors, including Oracle, Silver Lake and Andreessen Horowitz, would own 80% of the company.
Chinese shareholders would own the rest.
WSJ reported existing users in the U.S. would be asked to download a new app, which TikTok has built and is testing.
Under the deal, engineers with TikTok would re-create a set of content-recommendation algorithms for the app, using technology from TikTok’s parent company, ByteDance.
Oracle would continue handling American user data.
U.S. and Chinese officials are still finalizing the details, so terms could change. However, it seems the app will not be going away.
Why was TikTok at risk?
The video app faced a U.S. ban unless it shifted to non-Chinese control. Trump extended a 90-day deadline back in July, which was extended again on Tuesday until Dec. 16. The latest extension is the fourth.
While Trump originally pushed for a sale or ban, he has since argued the platform should remain available, saying it helped him reach younger voters in the latest election.
“A Republican never wins youth, but I won youth. I will tell you, TikTok helped me,” Trump said on Fox News.
Trump announces deal
Trump announced the new arrangement to reporters outside the White House on Tuesday:
“Well, we have a deal on TikTok. I’ve reached a deal with China. I’m going to speak to President Xi on Friday to confirm everything. We made a very good trade deal and I hope good for both countries, but a very different deal than they’ve made in the past. We have a group of very big companies that want to buy it. And, you know, the kids wanted it so badly. I had parents calling me up. They don’t want it for themselves. They want it for their kids. They say, if I don’t get it done, they’re in big trouble with their kids.
If this deal holds, it could finally end the years-long battle over TikTok – and keep the app running for its 170 million U.S. users.
US-China relations
The deal comes as the U.S. and China discuss tariffs, money laundering cooperation and curbing fentanyl. Earlier this year, tariffs surged into triple digits before both sides temporarily cut tariffs on U.S. imports from China to 30%, and 10% on China imports from the U.S.
That deal runs through Nov. 10.
