Framework Deal Reached Between China and US on TikTok Ownership

Strategic Insights -

US Treasury Secretary Scott Bessent announced after weekend trade talks in Spain that a framework deal has been reached between China and the US regarding the ownership of popular social video platform TikTok. The deal aims to transfer ownership from China's ByteDance to a US-based company, addressing US national security concerns over the app's data and algorithm. Key points from the agreement include entrusting a partner with handling US user data and content security, as well as authorization of TikTok's use of intellectual property rights.

Key Takeaways:

  • The framework deal was reached between China and the US regarding the ownership of TikTok, with the objective of switching to US ownership from China's ByteDance.
  • US Treasury Secretary Scott Bessent confirmed that the commercial terms of the deal have been agreed upon, but declined to disclose further details.
  • China's international trade representative Li Chenggang stated that the sides have reached a "basic framework consensus" to resolve TikTok-related issues in a cooperative manner.
  • The US and China agreed to entrust a partner with handling US user data and content security, as well as authorization of TikTok's use of intellectual property rights, including the proprietary algorithm.
  • The US has been concerned over ByteDance's roots and ownership, citing laws in China that require Chinese companies to hand over data requested by the government.
  • The deal represents an important step forward in resolving a lingering bilateral dispute, according to Wendy Cutler, senior vice president at the Asia Society Policy Institute.
  • Other long-running issues, such as export controls, Chinese investments in the US, and restrictions on chemicals used to make fentanyl, also came up during the talks.

Statistics:

  • 4th round of trade talks between US and Chinese officials since Trump launched a tariff war on Chinese goods in April
  • 5th round of negotiations likely to happen in the "coming weeks"
  • $50-$100 billion tariff imposed on Chinese imports by the US
  • 90-day rollover of the tariff pause between the US and China

Sources:

  • New Delhi Times, September 17
  • HT Digital Content Services with permission from New Delhi Times