ByteDance Agrees to New U.S. TikTok Joint Venture in Move to Avert Ban
GeokHub
Contributing Writer
WASHINGTON / HONG KONG — Dec 19, 2025 TikTok’s Chinese parent company, ByteDance, has signed binding agreements to transfer control of the app’s U.S. operations to a newly formed joint venture led by American and international investors, marking a major step toward avoiding a nationwide ban in the United States.
Under the deal, a new U.S.-based entity will oversee TikTok’s American platform, with ByteDance retaining a minority stake of 19.9%, while the remaining 80.1% will be held by a consortium of investors that includes major technology and private equity firms.
The agreement is expected to close on January 22, potentially ending years of political and regulatory uncertainty surrounding the app’s future in the U.S., where it is used by more than 170 million people.
How the New Structure Will Work
According to internal communications, the joint venture will operate as an independent company with authority over key areas including U.S. user data protection, algorithm security, content moderation, and software assurance.
User data will be stored on secure U.S.-based cloud infrastructure, with oversight mechanisms designed to address long-standing national security concerns raised by U.S. lawmakers.
ByteDance-controlled entities will continue to manage certain global commercial activities, including advertising, marketing and e-commerce, while the joint venture will provide technology and data services and receive a share of revenue under the new arrangement.
Questions Remain Over Algorithm Control
Despite the announcement, questions persist over the extent of ByteDance’s ongoing involvement, particularly regarding ownership and control of TikTok’s recommendation algorithm.
Some policy analysts have raised concerns about whether the algorithm has been fully transferred, licensed, or remains indirectly influenced by Beijing-based ownership, even as U.S. officials have described the deal as compliant with divestment requirements.
The new company’s board will consist of seven members, with American representatives holding a majority of seats and ByteDance appointing one director.
Political Reaction and Market Impact
The agreement has drawn mixed reactions in Washington. Supporters say it resolves national security risks while preserving a platform used by millions of Americans. Critics argue the deal lacks transparency and raises concerns about influence by wealthy investors.
Markets responded positively, with shares of companies involved in the deal rising following the announcement.
The transaction follows renewed political attention on TikTok after senior U.S. officials acknowledged the platform’s growing role in domestic media, politics and digital commerce.
