TikTok has finalized a landmark agreement to form a majority American-owned joint venture, a move designed to safeguard US user data and avoid a nationwide ban. The deal follows years of political pressure and regulatory scrutiny focused on national security, data privacy, and foreign ownership concerns.
Its Chinese parent company, ByteDance, said the new entity will be called TikTok USDS Joint Venture LLC and will oversee US user data, algorithms, and cybersecurity protections. American and global investors will collectively hold 80.1% ownership, while ByteDance retains a minority 19.9% stake.
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The agreement marks a turning point in a dispute that began in 2020, when former US President Donald Trump raised concerns about data access and national security. Although a 2024 law required divestment, enforcement was delayed after legal challenges reached the Supreme Court.
Under the new structure, three managing investors, including Oracle, Silver Lake, and MGX, will each hold equal stakes. The venture will host TikTok’s algorithm and data on US-based cloud infrastructure, strengthening oversight and security.
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Political reaction quickly followed, with Trump publicly praising the deal and thanking Xi Jinping for approving the arrangement. He also highlighted TikTok’s growing influence in American politics, noting its role in public engagement and digital campaigning.
Leadership appointments were also announced, with former USDS executives taking key security roles and TikTok CEO Shou Chew joining the venture’s board. The joint venture will manage data and algorithms, while ByteDance continues to run advertising and e-commerce operations tied to revenue generation.