US and China move toward agreement on TikTok ownership
The United States and China have moved closer to resolving the future of TikTok following a series of negotiations in Madrid that produced a framework agreement on the platform’s ownership. Treasury Secretary Scott Bessent confirmed that Washington and Beijing had reached preliminary terms designed to separate TikTok from its Chinese parent company ByteDance and shift control to an American entity.
The framework is intended to address bipartisan legislation passed in 2024 that required TikTok to be divested from Chinese ownership or face a ban in the United States. The law, upheld by the Supreme Court in January, mandated that the app be removed from U.S. app stores unless compliance was achieved. TikTok briefly went offline following the ruling before service was restored under an executive order from President Donald Trump, who delayed enforcement. Since then, the president has repeatedly extended the deadline, most recently to September 17, while negotiations continued.
Talks in Madrid were led by Bessent and U.S. Trade Representative Jamieson Greer, with Chinese Vice Premier He Lifeng heading the Beijing delegation. The discussions, lasting over ten hours across two days, focused heavily on the structure of TikTok’s divestment while also touching on broader trade disputes, including rare earth mineral exports and tariffs. Bessent described the process as ensuring U.S. national security while maintaining a fair investment environment for China.
The negotiations take place against a backdrop of escalating economic tensions. Earlier this year, the United States imposed steep tariffs on Chinese imports, initially set at 145 percent before being reduced to 30 percent. China retaliated with tariffs of its own while expanding trade with other regions to offset reduced exports to the U.S. At the same time, Washington has restricted Chinese access to advanced semiconductors, placing several firms on trade blacklists. In response, Beijing has launched investigations into American chipmakers and announced antitrust actions against companies such as Nvidia.
TikTok has emerged as both a symbol and a bargaining chip in this wider dispute. The app’s algorithm, which shapes user recommendations, remains a core point of contention, with U.S. officials demanding full American control to prevent potential influence from Beijing. Several American investors and firms have expressed interest in acquiring TikTok’s U.S. operations, including technology companies and private equity groups. One of the platform’s prominent U.S. stakeholders, investor Jeffrey Yass, has played a visible role in lobbying efforts to preserve the company’s access to the American market.
Despite the legal uncertainties, TikTok continues to operate for more than 170 million U.S. users. Trump has acknowledged the platform’s influence, particularly among younger voters, while maintaining that national security concerns must be resolved through divestment. He is expected to speak directly with Chinese President Xi Jinping to finalize the agreement in the coming days, a step that could end years of political and legal wrangling over the app’s future in the United States.
