On December 18, 2025, TikTok CEO Shou Zi Chew announced in an internal memo to employees that the company and its Chinese parent ByteDance have signed binding agreements to form a new US-based joint venture, transferring control of TikTok's American operations to a group of predominantly American and global investors. This development marks a significant step toward resolving years of national security concerns that nearly led to a nationwide ban of the popular short-video app in the United States.
The joint venture, named TikTok USDS Joint Venture LLC, will operate independently with authority over key aspects including US user data protection, algorithm security, content moderation, and software assurance. According to the memo, the structure ensures majority ownership by American investors and includes a seven-member board with a majority of American directors. ByteDance will retain a minority stake of 19.9%, while affiliates of certain existing ByteDance investors will hold approximately 30.1%. The remaining 50% will be owned by a consortium of new investors, including technology giant Oracle, private equity firm Silver Lake, and Abu Dhabi-based investment firm MGX, with each holding about 15%.
Chew emphasized in the memo that the deal will allow "over 170 million Americans to continue discovering a world of endless possibilities as part of a vital global community." He acknowledged that additional work is needed but expressed optimism, noting the transaction is expected to close on January 22, 2026.
This agreement stems from a bipartisan US law passed in 2024, known as the Protecting Americans from Foreign Adversary Controlled Applications Act, which required ByteDance to divest approximately 80% of its US assets to non-Chinese owners or face a ban. The law, upheld by the Supreme Court in early 2025, took effect in January 2025, briefly disrupting service before enforcement was delayed. Concerns centered on potential Chinese government access to American user data or manipulation of the app's algorithm for propaganda purposes.
In September 2025, President Donald Trump issued an executive order declaring a proposed framework a "qualified divestiture," postponing enforcement for 120 days to facilitate completion. The order highlighted that the new entity would retrain the recommendation algorithm on US user data, store sensitive information in Oracle-managed US cloud facilities, and sever operational ties that could allow foreign influence.
Oracle's role extends beyond investment; it will serve as the "trusted security partner," auditing compliance and safeguarding data. This addresses longstanding worries about ByteDance's obligations under Chinese law to cooperate with intelligence requests.
The deal concludes a protracted saga that began in 2020 under Trump's first administration with initial ban threats, escalated through court challenges, and involved multiple extensions under both Biden and Trump administrations. TikTok, with over 170 million US users, has become a cultural and economic force, supporting creators, small businesses, and advertising revenue.
While the signed agreements represent progress, final closure depends on regulatory approvals, including potential review by the Committee on Foreign Investment in the United States (CFIUS). Critics, including some lawmakers, have previously questioned whether partial ByteDance retention fully mitigates risks, but the Trump administration has affirmed the structure complies with the law.
This resolution preserves TikTok's availability in the US while aligning with national security priorities, potentially setting precedents for foreign-owned tech platforms.
