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China's ByteDance will get 1 of 7 board seats for TikTok's US operations, official says
A U.S.-China agreement on TikTok's U.S. operations includes China's ByteDance choosing one of seven board members for the new entity, with Americans holding the six other seats, a senior White House official said on Saturday.
President Donald Trump is trying to keep the short video app with 170 million U.S. users from being banned after Congress passed a law in 2024 that ordered it shut down by January 2025 if its U.S. assets were not sold by owner ByteDance.
Trump has delayed enforcement of the law through mid-December amid efforts to extract TikTok's U.S. assets from the global platform, line up American investors and ensure the new ownership qualifies as a full divestiture needed under the 2024 law.
This week's progress toward a deal marked a rare breakthrough in months-long talks between the world's two biggest economies that have sought to defuse a wide-ranging trade war that has unnerved global markets.
Trump said on Friday that he and Chinese President Xi Jinping had made progress on a TikTok agreement in a phone call and would meet face-to-face in six weeks. But Beijing's statements have not clarified how advanced the progress has been.
Details of the agreement, as laid out by the senior White House official, largely align with reporting from Reuters and other news outlets in recent days. The official said Trump would extend the latest pause in enforcement of the 2024 law for an additional 120 days, suggesting the next deadline for an agreement to be finalized would be in April.
TikTok did not immediately respond to a request for comment.
Still, lawmakers will want an explanation about how the deal will work.
"The devil will be in the details," said Representative Frank Pallone, a Democrat. "We cannot allow China continued access to massive amounts of Americans' personal data, and we cannot allow Trump to hand TikTok over to his tech bro buddies and turn it into a MAGA mouthpiece. Period."
It is not clear if the deal in its current state will qualify as a full divestiture as required by Congress under the 2024 law.
Trump has credited TikTok with helping him win re-election last year and has 15 million followers on his personal account. The White House also launched an official TikTok account last month.
The agreement described by the official, as expected, will require that all data on American users will be stored on U.S. cloud computing infrastructure run by U.S. software firm Oracle .
The official also said the TikTok algorithm "will be secured, retrained and operated in the United States outside of ByteDance's control."
"TikTok's content-recommendation algorithm will be retrained from the ground up - reviewed and analyzed under U.S. supervision with U.S. data that will not be shared outside of the United States," the official said.
This is an important point because U.S. officials had warned in recent years that the algorithm could be used by China to manipulate what Americans see on social media. Reuters and others reported this week that the algorithm could be licensed from ByteDance.
The official said U.S. users would still be able to use TikTok to interact with content from around the world.
TikTok's U.S. assets would be majority-owned by American investors and operated in the United States by a board of directors with national security and cybersecurity credentials, the official added.
ByteDance's current shareholders include Susquehanna International Group, General Atlantic, and KKR. ByteDance would hold less than 20% of the stock of a joint venture controlling TikTok's U.S. operations, the official said.
Source: EconomicTimes
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