The Trump administration believed it had a plan to save TikTok by creating a new ownership structure that would satisfy national security concerns. Under the plan, new investors would own 50% of a new American TikTok entity, while Chinese owners would retain less than 20%. However, the plan hit a roadblock when ByteDance informed the White House that the Chinese government would not allow the deal to proceed due to new tariffs imposed by President Trump. As a result, Mr. Trump extended the deadline for a TikTok deal into mid-June.
The standstill highlights the geopolitical tussle between the U.S. and China over trade and tech supremacy, with TikTok caught in the middle. The Chinese Embassy, TikTok, and ByteDance did not respond to requests for comment, and the White House referred to Mr. Trump’s announcement of an extension for the debate over the app. The proposal for the TikTok deal involved new American investors owning 50%, current investors owning 30%, and Chinese owners owning less than 20%.
There was still more work to be done on the deal, as certain potential new investors viewed it as conditional. The talks about TikTok are likely to become more complicated as the trade war between the U.S. and China escalates. Mr. Trump has suggested that he would consider lowering tariffs on China in exchange for its approval of a TikTok deal, but the future of the negotiations remains uncertain. TikTok has previously maintained that it is not for sale.
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