TikTok U.S. Deal Collapses Over China Tariffs

Negotiations surrounding a potential restructuring of TikTok’s U.S. operations have stalled after China signaled its disapproval, reportedly due to recently imposed tariffs by the United States. Sources with knowledge of the discussions revealed that Beijing’s reluctance emerged following President Trump’s announcement of reciprocal tariffs, effectively halting a deal that was nearing completion.

The proposed agreement aimed to establish a new, U.S.-based company to oversee TikTok’s American operations. This entity would be majority-owned by U.S. investors, with ByteDance, TikTok’s parent company, retaining a minority stake of less than 20%. The structure of this spin-off was reportedly largely finalized as of Wednesday.

Crucially, the deal had already received approval from existing and prospective investors, ByteDance itself, and the U.S. government, according to one source. This widespread support makes China’s intervention particularly noteworthy.

The sudden impasse raises questions about the future of TikTok in the United States, and highlights the increasing entanglement of geopolitical tensions with technology and business. While the White House and ByteDance have yet to officially comment, the lack of immediate response underscores the sensitivity of the situation. The Chinese Embassy in Washington D.C. also has not provided a statement.

This development suggests that trade disputes are now directly impacting foreign investment and potentially reshaping the landscape of social media. It remains to be seen whether a compromise can be reached, or if this marks the beginning of a more significant decoupling between the U.S. and Chinese tech sectors.