TikTok avoids ban in the US by signing an agreement with US companies

The platform is under threat of a ban in the United States due to its Chinese ownership.

According to an internal TikTok memo seen by AFP, The agreement stipulates that 45% of the control of the joint venture will be assigned to the American companies Oracle and Silver Lake, as well as the Emirati investment fund MGX.

Oracle CEO and founder Larry Ellison is close to US President Donald Trump.

In the document, TikTok CEO Shou Chew informs his employees that one-third of the US joint venture will be held by ByteDance’s current investors, including several US funds.

For its part, ByteDance will have almost 20%, the maximum percentage allowed to a Chinese company under the law.

TikTok’s new structure responds to a law passed in 2024 during the administration of Trump’s predecessor, Joe Biden, that forced ByteDance to sell the platform’s operations in the United States or face being banned from its largest market.

Trump and several US lawmakers believe that China could use TikTok to extract data from US citizens or exert influence through its sophisticated algorithm.

After his return to the White House in January, Trump repeatedly delayed implementation of the law through successive executive orders. Currently, the deadline expires on January 23, 2026.

Chew indicated there is still work to be done before the deal closes.

“Independent entity”

The agreement largely confirms a September announcement from the White House that indicated it had agreed with China to create a new joint venture that would meet the requirements of the 2024 law.

“Following the closing of the agreement, the American joint venture (…) will operate as an independent entity with authority over data protection, algorithm security, content moderation, and software security in the United StatesChew said in the memo.

Meanwhile, “TikTok Global’s US entities will manage global product interoperability and certain business activities, including e-commerce, advertising and marketing,” it said.

The memo does not clarify whether this unit would remain owned by ByteDance.

A Chinese spokesperson reiterated that China’s position on TikTok is “consistent and clear,” without directly commenting on the deal.

The 2024 law sought to prevent Chinese authorities from accessing the personal data of TikTok users in the United States.

TikTok, which claims to have more than 170 million users in the United States, admitted that China-based employees had access to American user data, but maintained that nothing had been shared with the Chinese government.