US & China Agree on TikTok Deal

The US and China reached a framework agreement to transfer TikTok to US-controlled ownership.

Congress passed a law in 2024 requiring TikTok's Chinese parent company, ByteDance, to sell the app by January 19, 2025, or face a ban, citing national security concerns about potential Chinese government access to American user data. Trump refused to enforce the law when he took office and issued multiple executive orders extending the deadline. Negotiations have been ongoing since January, with previous talks failing to produce an agreement.

On Monday, US Treasury Secretary Scott Bessent and China's vice premier ended two days of talks in Madrid that produced what Bessent called a framework to switch TikTok to US-controlled ownership while preserving Chinese cultural aspects of the app.

"We're 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," Bessent told reporters. Chinese officials confirmed they had reached a "basic framework consensus" on a TikTok deal, though they emphasized any deal would need to comply with Chinese law regarding technology exports and intellectual property.

The agreement's specific terms remained unclear, though a Chinese cyberspace official mentioned the deal could involve licensing intellectual property rights, including algorithms, rather than a full transfer of technology. Oracle, which already hosts TikTok's US user data in Texas, is expected to play a role in the new arrangement, according to sources familiar with the discussions. ByteDance's ownership stake would reportedly shrink below 20% to comply with US law, with US investors taking majority control.

A US official said that without an agreement on TikTok, the planned Trump-Xi meeting at the Asia-Pacific Economic Cooperation gathering in South Korea next month would have been canceled, making a TikTok deal crucial to US-China relations. The negotiations came as China launched investigations into Nvidia during the talks, which Bessent called poor timing. Both nations maintain a pause on their tariffs against each other.