On Friday, former President Trump hinted that China’s top leader, Xi Jinping, had given the green light to a deal aimed at separating TikTok from its current Chinese parent company, ByteDance.
Taking to Truth Social after his conversation with Mr. Xi, Trump declared, “The call was a very good one, we will be speaking again by phone, appreciate the TikTok approval.” He offered no further specifics about the nature of this alleged approval.
A report from China’s state-run news agency echoed this ambiguity, stating that Mr. Xi affirmed the Chinese government’s respect for corporate autonomy and its encouragement for companies to pursue commercial negotiations guided by market principles, ultimately seeking resolutions that align with Chinese laws and regulations while balancing mutual interests.
TikTok’s operational future in the United States has been uncertain since January, when a federal mandate took effect, compelling the company to divest from its Chinese ownership or face a nationwide ban. This legislation was enacted to mitigate national security risks, specifically concerns that the app’s ties to Beijing could facilitate propaganda dissemination or the collection of sensitive American user data. Trump has already granted four extensions to this crucial deadline.
For several months, ByteDance has been actively negotiating a plan to separate TikTok’s U.S. operations into a new entity. This strategy involves bringing in new American investors, such as software giant Oracle, to reduce Chinese ownership and comply with the recent federal law. Insiders close to the discussions indicate that the lineup of potential investors has been fluid.
Adding another layer to the narrative on Thursday, Trump mentioned that the U.S. would receive a “tremendous fee” for orchestrating the deal. Should this materialize, it would mark yet another instance of significant government involvement in private corporate transactions. Notably, the Trump administration recently secured a 10 percent stake in Intel and a “golden share” in U.S. Steel during its sale to Nippon Steel.
The groundwork for a deal to allow TikTok to continue operating in the U.S. was initially unveiled by Treasury Secretary Scott Bessent at a Monday news conference in Madrid, where he stated that a “framework” had been established.
Previously, Chinese officials had expressed strong opposition to any forced sale of TikTok. In 2020, China even updated its export control regulations to encompass key technologies such as algorithms and source codes, making such a divestiture more complex.
According to a statement in Chinese state media, Li Chenggang, China’s vice minister of commerce, explained in Madrid that China agreed to a TikTok deal with the U.S. because “this consensus serves the interests of both sides,” following his meeting with American counterparts.
Just one day before TikTok’s mandated divestiture deadline, Trump granted his fourth extension this year, pushing it to mid-December. With the president’s latest comments on Friday suggesting a deal approval, this extension might indeed be the last.