Summary

Trump and Xi Take Action: Major Developments in the TikTok Negotiations
TikTok, a widely popular social media platform owned by the Chinese company ByteDance, became a focal point of U.S.-China tensions over national security and data privacy concerns between 2019 and 2024. The U.S. government, citing risks of data access by the Chinese Communist Party and potential misuse of user information for censorship or disinformation, initiated a series of investigations and regulatory actions aimed at curbing TikTok’s influence in the United States. These concerns prompted the Committee on Foreign Investment in the United States (CFIUS) to review ByteDance’s acquisition of Musical.ly, TikTok’s precursor, and eventually led to executive orders during the Trump administration that sought to force ByteDance to divest its U.S. operations or face a ban on the app.
The negotiations over TikTok’s future in the U.S. involved high-level engagement from both governments, including direct communications between President Donald Trump and Chinese President Xi Jinping. A “framework” deal was announced in late 2023, proposing a restructuring of TikTok’s U.S. ownership to include a consortium of American investors led by Oracle, intended to secure U.S. user data and introduce government-approved audits to prevent unauthorized access by Beijing. Despite this breakthrough, key issues remained unresolved, such as the degree of control retained by ByteDance over TikTok’s algorithm and whether data storage and encryption protocols sufficiently mitigated national security risks.
The TikTok negotiations have not only reflected the specific challenges of regulating a single platform but also epitomized broader geopolitical dynamics between the U.S. and China. The dispute highlighted competing interests over technology governance, trade imbalances, and digital sovereignty amid escalating U.S.-China economic rivalry. The controversy further sparked mixed reactions domestically, balancing TikTok’s immense cultural popularity—especially among younger Americans—with bipartisan calls for safeguarding national security.
Ultimately, the TikTok case underscored the complexity of addressing foreign ownership of critical digital infrastructure in a polarized geopolitical environment. While the Trump-Xi discussions and subsequent framework averted an immediate ban, experts and officials remain cautious about the long-term effectiveness of the deal, pointing to persistent uncertainties about data security, algorithmic control, and enforcement mechanisms. The saga serves as a precedent for how the United States may navigate future conflicts at the intersection of national security, technology, and international diplomacy.

Background

TikTok, a popular social media platform owned by the Chinese company ByteDance, has been at the center of significant controversy and negotiations between the United States and China. Concerns in the U.S. primarily revolve around national security risks linked to data privacy and potential Chinese government influence over the app’s operations. In particular, U.S. officials have expressed fears that TikTok could be used to access sensitive personal data of American users or to conduct censorship and disinformation campaigns favorable to the Chinese Communist Party.
The platform gained widespread popularity for its short, often lighthearted videos and music clips, helping to launch the careers of artists such as Lil Nas X. Despite its success, TikTok’s ownership by ByteDance, a company headquartered in China, has led to scrutiny from U.S. regulatory bodies. The Committee on Foreign Investment in the United States (CFIUS) has reviewed ByteDance’s 2017 acquisition of Musical.ly, a precursor to TikTok, over concerns that the deal could pose national security threats by granting access to American user data.
From 2019 to 2024, TikTok and ByteDance have spent approximately $27 million on lobbying efforts in the U.S., highlighting the intensity of the ongoing political and regulatory pressures. Legal measures, including executive orders during the Trump administration, sought to address these security concerns by demanding that ByteDance divest its interests in TikTok’s U.S. operations or face a ban on the app. While these efforts were initially stalled or postponed, the issues remained a focal point of broader U.S.-China trade and diplomatic discussions.
Negotiations have centered on establishing a new ownership structure to satisfy U.S. legal requirements while attempting to preserve TikTok’s business model. Key topics have included data security measures such as domestic storage and encryption of American users’ data, independent audits to prevent unauthorized access by Beijing, and the contentious matter of transferring TikTok’s algorithm, which is considered a core intellectual property possibly subject to Chinese export controls. The U.S. government has also banned TikTok on federal government devices, citing concerns about potential espionage and disinformation risks.
Throughout this period, officials from both countries, including President Donald Trump and President Xi Jinping, have been directly involved in discussions, underscoring the geopolitical importance of the issue within the larger context of U.S.-China relations and trade tensions. The evolving situation reflects broader U.S. efforts to mitigate perceived threats from Chinese technology firms while balancing commercial interests and national security considerations.

Early Negotiations and Investigations

Negotiations surrounding TikTok’s ownership and operations in the United States began amid rising national security concerns over the app’s connection to its Chinese parent company, ByteDance. In response to these concerns, the Committee on Foreign Investment in the United States (CFIUS) opened an investigation into ByteDance’s acquisition of Musical.ly, the predecessor to TikTok, signaling a shift toward greater scrutiny of foreign investments involving sensitive data. This investigation coincided with President Trump initiating a process aimed at potentially banning TikTok in the U.S..
Throughout these early stages, ByteDance and CFIUS engaged in discussions to address U.S. security apprehensions. Notably, teams from both sides met at the Treasury Department to revisit a proposal ByteDance had submitted over a year prior, which sought to alleviate concerns about the app’s data practices and ownership structure. Despite these efforts, negotiations continued for nearly three years, reflecting the complexity and sensitivity of the issue.
The U.S. government’s concerns were formally underscored by executive actions requiring ByteDance to divest its interests in TikTok’s U.S. operations and any related user data. This included an order for ByteDance to certify destruction of such data following divestiture. Additionally, legislative measures provided CFIUS and the president with expanded factors to consider in reviewing transactions, emphasizing access to personally identifiable, genetic, or other sensitive data of U.S. citizens that could threaten national security.
These early negotiation efforts and investigations set the groundwork for later, more intensive discussions aimed at restructuring TikTok’s U.S. ownership to mitigate perceived risks. The process involved multiple government agencies and reflected evolving U.S. policy toward foreign technology firms handling sensitive American data.

Trump Administration’s Policies and Actions

The Trump administration took a series of assertive measures targeting TikTok, citing national security concerns. President Donald Trump declared a national emergency regarding the information and communications technology and services supply chain, referencing Executive Order 13873 issued in May 2019, which aimed to secure U.S. information technology infrastructure from foreign threats.
In August 2020, Trump issued two executive orders addressing TikTok’s alleged threat to U.S. national security. These orders asserted that TikTok’s data collection practices could be exploited by the Chinese government to harm the United States, its residents, and its businesses. The administration demanded that ByteDance divest its ownership of TikTok’s U.S. operations by set deadlines, initially September 17, 2020, and subsequently extended multiple times, with a final deadline of November 12, 2020, unless further extensions were granted by CFIUS. The executive actions threatened to ban TikTok in the U.S. if these conditions were not met.
President Trump also indicated that the TikTok ban was part of broader trade and economic discussions with China, including addressing what he described as “unilateral tariff measures” and “abuse of export controls,” which were topics to be discussed with Chinese President Xi Jinping. Despite these pressures, TikTok announced plans to legally challenge the executive orders, arguing that the administration’s actions were politically motivated and designed to protect Trump’s reelection prospects by targeting a platform associated with political pranks and criticism of his presidency.
The administration’s approach drew mixed reactions. While Trump claimed bipartisan support for banning TikTok due to concerns over Chinese influence and national security, critics and TikTok users accused the administration of using national security as a pretext for retaliation against online content critical of Trump, particularly content related to his handling of the George Floyd protests and prank campaigns affecting his campaign rallies.
In January 2021, TikTok briefly went dark in the U.S. following the implementation of the Foreign Adversary Controlled Applications Act but resumed service shortly thereafter. On the day before President Joe Biden’s inauguration, Trump indicated he would sign an executive action protecting U.S. companies from penalties for hosting TikTok on their platforms, signaling a nuanced approach to enforcement near the end of his term.
The Trump administration’s policies also influenced state-level actions, with at least 34 states instituting bans on the use of TikTok on government-issued devices by state employees and contractors as of April 2023, reflecting ongoing concerns over the app’s security risks. Overall, the administration’s policies marked a significant escalation in the U.S. government’s scrutiny of Chinese technology firms and their role in national security.

Xi Jinping and Chinese Government Involvement

Chinese President Xi Jinping and the Chinese government have played a pivotal role in the negotiations surrounding the future of TikTok’s U.S. operations. Initially, Chinese officials strongly opposed U.S. demands that TikTok’s Chinese owner divest its American business, condemning such requests as unfair and equating them to “daylight robbery.” However, as talks progressed, Chinese state media began to frame a potential agreement as a mutually beneficial solution, signaling a shift in official stance.
Xi’s involvement extends beyond the TikTok issue itself, reflecting a broader strategy to reshape the global order in ways that diminish U.S. centrality. Recently, Xi convened leaders from more than 20 countries in China, underscoring Beijing’s efforts to establish a new international framework amid escalating tensions with the United States. This geopolitical context informs China’s approach to trade and technology disputes, including the TikTok negotiations.
China’s lead trade negotiator, Li Chenggang, confirmed the existence of a framework deal and criticized ongoing U.S. actions to suppress Chinese companies. These remarks came amid the latest round of trade discussions, highlighting the souring relations due to tariffs and trade restrictions imposed by the Trump administration. Throughout these negotiations, preserving TikTok’s cultural and technological attributes—what Chinese officials refer to as the app’s “Chinese characteristics” and a form of soft power—has been a key priority for Beijing. Chinese negotiators have sought to ensure these elements remain intact even as ownership changes hands.
The Chinese government’s involvement culminated in the anticipation of a high-profile phone call between Xi Jinping and President Donald Trump, scheduled to finalize and bless the deal. This conversation was seen as crucial ahead of the U.S. government’s deadline for TikTok to either divest or cease operations in the country. China’s efforts to engage directly with Trump, including invitations for a summit in Beijing, demonstrate the importance Beijing places on resolving this dispute in a way that safeguards its strategic interests.
Beyond the immediate negotiations, the TikTok saga has catalyzed broader policy discussions within China about technological self-reliance. The controversy has spurred calls to develop domestic alternatives and reduce dependence on foreign markets, reflecting a strategic pivot toward securing China’s position in a new era of technological competition and digital sovereignty.

Major Negotiation Developments

In a significant step toward resolving longstanding tensions over TikTok’s presence in the United States, the U.S. and China reached a “framework” deal regarding the social media platform’s operations. Treasury Secretary Scott Bessent announced on Monday that the commercial terms had been agreed upon between the two private parties involved, paving the way for U.S.-controlled ownership of TikTok’s American operations. This breakthrough came as President Donald Trump and Chinese President Xi Jinping prepared to discuss and potentially finalize the deal during a scheduled call on Friday, marking a rare direct engagement between the two leaders since mid-year.
The deal followed intense negotiations, including talks held in Madrid, where both countries also discussed broader trade, economic cooperation, and national security issues. The deadline originally set for September 17 to determine TikTok’s future in the U.S. was extended multiple times by President Trump, with the latest extension allowing negotiators until mid-December to finalize the agreement. This extension effectively precluded enforcement of a national security law that would have banned TikTok in the U.S. until December 16.
A key focus of the negotiations was addressing U.S. national security concerns, particularly regarding the handling and protection of American users’ data. While early fears centered on TikTok’s algorithm, officials have increasingly emphasized data security as the dominant issue. As part of the proposed framework, Oracle and several independent auditing firms are expected to monitor data flows, review source code, verify data deletion, and ensure compliance with the agreement’s terms. The involvement of these firms is intended to maintain strict oversight and reduce potential access by Beijing to sensitive information.
The precise technical details of the deal remain under discussion, including whether ByteDance, TikTok’s Chinese parent company, will transfer control of the app’s underlying technology or merely license intellectual property rights such as algorithms. Chinese officials have expressed interest in preserving certain cultural aspects of TikTok, which the deal aims to respect. Additionally, it remains uncertain whether American user data will be fully stored and encrypted domestically or subject to independent audits to prevent backdoor access.
Behind the scenes, ByteDance, alongside U.S. investors and government officials, has coalesced around a new ownership structure intended to satisfy federal law requirements designed to mitigate national security risks. This structure builds on earlier initiatives such as “Project Texas,” which sought to place TikTok’s data under the custodianship of Oracle and implement regular audits of the app’s algorithm.

Impact on TikTok’s Operations and Technological Infrastructure

The framework deal reached between the United States and China concerning TikTok has significant implications for the app’s operations and technological infrastructure in the U.S. Under the agreement, approximately 80% of TikTok’s U.S. business would be owned by an investor consortium comprising Oracle, Silver Lake, and Andreessen Horowitz. This consortium structure is designed to address national security concerns by effectively separating TikTok’s American operations from its Chinese parent company, ByteDance.
A key operational change involves existing U.S. users being required to shift to a new version of the app under the new ownership structure, ensuring that TikTok’s American data ecosystem is distinct and more secure. Oracle has been designated as TikTok’s “trusted tech partner,” a role that entails managing U.S. user data and overseeing the technological infrastructure to allay data security fears raised by the Trump administration.
Central to the technological adjustments is an extensive government-approved auditing regime. Oracle, along with five independent auditing firms, is expected to monitor data flows in and out of TikTok’s U.S. subsidiary, review the app’s source code, verify the deletion of old user data, and ensure compliance with the terms of the agreement. This arrangement reflects a continuation and expansion of Project Texas, an earlier plan from the Trump administration, which envisioned Oracle as a custodian responsible for conducting regular audits on TikTok’s algorithm and data handling practices.
Despite these measures, some uncertainty remains regarding the extent of domestic data storage and encryption, and the ability to prevent potential backdoor access by Beijing. Experts caution that while ownership changes may be formalized, underlying vulnerabilities related to data sovereignty and algorithmic control may persist. The final control over TikTok’s recommendation algorithm—an essential component of the app’s success—remains unclear, partly due to Chinese influence and ongoing broader trade negotiations between the U.S. and China.
The deal also preserves certain cultural aspects of TikTok valued by Chinese negotiators, indicating a nuanced balance between security concerns and maintaining the app’s global identity. The arrangement, although significant, does not fully resolve the broader tensions in the China-U.S. relationship, especially regarding technological competition and national security issues that continue to influence future developments in TikTok’s operation and infrastructure.

Broader Implications and Market Effects

The ongoing TikTok negotiations between the United States and China highlight broader implications for U.S.-China economic relations and market dynamics, especially amid escalating trade tensions. Tik

National Security Considerations and CFIUS Review

The Committee on Foreign Investment in the United States (CFIUS) played a central role in the review of TikTok’s ownership due to national security concerns. Traditionally tasked with scrutinizing foreign investments that may affect U.S. national security, CFIUS expanded its focus in recent years to include transactions involving sensitive personal data of U.S. citizens. This shift is reflected in provisions allowing the committee and the president to consider risks related to access to “personally identifiable information, genetic information, or other sensitive data” that could be exploited in ways threatening national security.
The scrutiny of TikTok’s parent company, ByteDance, particularly centered on its 2017 acquisition of Musical.ly, the precursor to TikTok. At the time of purchase, ByteDance did not anticipate national security implications and did not submit the transaction to CFIUS. However, in light of growing concerns over data privacy and potential foreign influence, CFIUS initiated an investigation into the acquisition, signaling a broader willingness to intervene in cases involving access to sensitive U.S. data. Treasury Secretary Steven Mnuchin publicly stated that his department would be making recommendations to the president concerning the matter, highlighting the seriousness with which the issue was being addressed.
National security concerns regarding TikTok extend beyond data privacy. The U.S. government has cited potential risks related to content censorship and disinformation campaigns that may serve the interests of the Chinese Communist Party (CCP). TikTok has reportedly suppressed politically sensitive content, such as information about protests in Hong Kong and the treatment of Uyghurs and other Muslim minorities in China. Additionally, TikTok videos have been used to spread debunked conspiracy theories, including those about the origins of the COVID-19 pandemic. These factors have contributed to bans on TikTok usage across several federal agencies, including the Department of Homeland Security, the Transportation Security Administration, and branches of the U.S. Armed Forces.
In the broader context of U.S.-China relations, the TikTok case reflects wider apprehensions about technology transfers and data security. The U.S. has taken measures to restrict shipments of semiconductors and advanced technologies to China and to block Chinese products deemed capable of spying or intelligence gathering. China’s response has characterized these actions as “unilateral bullying” in trade negotiations.
One unique aspect of the TikTok negotiations is the conditional allowance for the platform to avoid a ban if its ownership is transferred to a U.S. company by a specified deadline. This contrasts with previous CFIUS cases where transactions were forcibly terminated or companies compelled to divest regardless of mitigating actions proposed. This approach underscores the evolving nature of CFIUS’s review process in addressing national security concerns related to foreign investments and data privacy.

Direct Communications Between Trump and Xi Jinping

In the context of the TikTok negotiations, President Donald Trump and Chinese President Xi Jinping engaged in direct communications to discuss and potentially finalize a framework deal regarding the app’s operations in the United States. This marked the first direct engagement between the two leaders since June, highlighting the significance of the issue at the highest diplomatic level.
President Trump announced that he would speak with Xi Jinping on a Friday scheduled for negotiations, emphasizing the importance of their dialogue in determining the future of TikTok’s U.S. business. The conversation was expected to formalize the framework deal that U.S. and Chinese officials had been working on, as initially reported by The Wall Street Journal, which noted that details of the framework were still subject to change pending the leaders’ discussion.
The framework deal aimed to keep TikTok operational in the United States under conditions acceptable to both parties, with commercial terms reportedly agreed upon between private entities. However, the final agreement depended on the outcome of the Trump-Xi phone call. This direct communication underscored the strategic priority given by both administrations to resolving the TikTok issue amid broader trade negotiations.
The meeting and discussions between Trump and Xi came against the backdrop of tense U.S.-China relations, with Xi Jinping previously convening leaders from over 20 countries to advocate for a global order less dominated by the United States. Trump’s tough trade tactics had also strained relations with other allies, adding further complexity to the diplomatic landscape in which the TikTok negotiations occurred.

Public and Political Reactions

The negotiations between the Trump administration and Chinese officials over TikTok’s ownership and control sparked significant public and political reactions in the United States. Concerns centered primarily on national security risks posed by the app, given its Chinese ownership, and fears of potential data privacy violations and disinformation campaigns. These concerns were heightened by the memory of foreign interference in previous U.S. elections, particularly Russia’s meddling in 2016, which influenced the intensity of the Committee on Foreign Investment in the United States (CFIUS) review process.
Politically, the move to divest TikTok from its Chinese parent company ByteDance reflected a broader bipartisan consensus on restricting Chinese technology firms perceived as threats to U.S. interests. However, some analysts noted that if the Trump administration were to reverse or soften the ban through legislative action, it could be viewed domestically as a sign of capitulation, potentially undermining the administration’s stance on China and its tough rhetoric on technology-related national security issues. The saga around TikTok thus became a paradigmatic example of how commercial interests are deeply entwined with geopolitical tensions between the United States and China.
Among the American public, TikTok retained strong popularity, especially among younger demographics. Approximately 37% of U.S. TikTok users were aged 10–19, and 26% were in their twenties, illustrating the app’s significant cultural influence despite the controversies. This popularity complicated efforts to restrict or ban the platform, as many users and advocacy groups emphasized the app’s role as a source of entertainment and social connection.
Meanwhile, responses from other governments varied. For example, the Indian government confirmed that there were no plans to relaunch TikTok in India despite the company’s global outreach efforts. In the U.S., top officials, including Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, led negotiations indicating a possible shift of TikTok’s ownership to U.S. control, which President Trump publicly supported as a solution favorable to American youth. Chinese officials also framed the agreement reached in Madrid as part of a broader effort to enhance trade and economic cooperation between the two countries beyond the TikTok issue itself.

Resolution, Aftermath, and Continuing Issues

The TikTok negotiations between the United States and China reached a significant milestone with the announcement of a “framework” deal during the U.S.-China talks in Madrid. Treasury Secretary Scott Bessent confirmed that the commercial terms had been agreed upon between the private parties involved, signaling a potential end to the threat of TikTok being banned in the U.S. President Donald Trump also publicly acknowledged the development on Truth Social, describing the deal as one involving a “certain” company that many young Americans wanted to preserve, and noted that he would speak with President Xi Jinping to further discuss the terms.
Central to the resolution was the involvement of a consortium of companies, including the technology firm Oracle, which is expected to play a pivotal role in enabling TikTok to continue operating within the United States under the new framework. However, the precise structure of the deal remains unclear, particularly concerning the extent of involvement of TikTok’s Chinese parent company, ByteDance, and control over TikTok’s recommendation algorithm. These unresolved issues contribute to ongoing concerns about data security and national sovereignty.
The deal also comes with a deadline condition stipulating that TikTok will not face a ban if a sale to a U.S. company is completed by September 15, a move that diverges from previous Committee on Foreign Investment in the United States (CFIUS) cases where deals were terminated despite mitigating efforts. To facilitate finalization, this deadline may be extended by 90 days, allowing additional time to settle remaining details.
Despite the framework agreement, substantial apprehensions persist. Experts and officials have highlighted uncertainties regarding whether American user data will be fully stored and encrypted domestically, and whether independent audits will be implemented to prevent backdoor access by Beijing. Sarah Kreps of the Tech Policy Institute warned that ownership changes on paper might not address the underlying vulnerabilities, while former national security official Jim Secreto emphasized that Beijing’s control over the algorithm could undermine the deal’s effectiveness.
Beyond TikTok, the negotiations have broader implications. Chinese officials indicated that the agreement encompasses commitments to lower investment barriers and improve trade and economic cooperation between the two countries, expanding the scope beyond just the social media platform. At the same time, China criticized U.S. national security measures—including semiconductor shipment restrictions and bans on certain Chinese products—as “unilateral bullying,” underscoring the continuing tension in U.S.-China relations despite progress on TikTok.
The upcoming conversation between Presidents Trump and Xi Jinping is expected to address these multifaceted issues and potentially pave the way for a more comprehensive resolution. Until then, while the framework deal marks a crucial step forward, significant questions about enforcement, data privacy, and the balance of control remain, leaving the future of TikTok’s operations in the U.S. and broader trade relations subject to ongoing negotiation and scrutiny.

Legacy

The negotiations between the Trump administration and Chinese leadership, particularly President Xi Jinping, regarding TikTok have left a complex legacy marked by unresolved national security concerns and the intertwining of trade and geopolitical tensions. Despite reaching a “framework” deal that allowed TikTok to continue operations in the United States under certain conditions, many experts remained skeptical about the effectiveness of the agreement in addressing the core risks posed by the app’s Chinese ownership.
A significant aspect of the legacy is the uncertainty surrounding data security. Experts like Sarah Kreps of the Tech Policy Institute have highlighted that it remains unclear whether American users’ data would be fully stored and encrypted within the United States or subject to independent audits capable of preventing backdoor access by Beijing. This raised fears that the deal might only resolve ownership superficially without eliminating vulnerabilities tied to China’s influence over the app’s algorithm and data. Former national security officials emphasized that data collected from American users could potentially be exploited to enhance Chinese military and intelligence capabilities, underscoring ongoing apprehensions about the geopolitical implications of TikTok’s presence in the U.S. market.
Politically, the TikTok negotiations underscored the broader context of U.S.-China relations, which saw escalating tensions involving trade restrictions, tariffs, and technology bans. The discussions over TikTok were integrated into wider trade talks, reflecting how national security concerns influenced economic diplomacy. Chinese negotiators criticized U.S. actions as “unilateral bullying,” particularly regarding measures that affected the semiconductor industry alongside TikTok’s fate. The deal also highlighted the rare condition that TikTok would not be banned outright if a sale to a U.S. company occurred by a specified deadline, illustrating the unique and high-profile nature of this case within the Committee on Foreign Investment in the United States (CFIUS) processes.
Beyond security and trade, TikTok’s negotiations exposed concerns about content censorship and information control. The platform was accused of suppressing politically sensitive content aligned with Chinese Communist Party interests, including coverage of protests in Hong Kong and the treatment of Uyghurs. Furthermore, fears of disinformation campaigns leveraging TikTok’s wide reach contributed to government bans on the app for federal devices, reflecting enduring distrust of the platform’s potential role in shaping public discourse and influencing political narratives.
Ultimately, the TikTok case symbolizes the complexities of regulating Chinese technology firms in the United States amid rising geopolitical competition. The negotiations left a legacy of partial resolutions, ongoing scrutiny, and a precedent for how future conflicts between national security and global digital commerce might be navigated under shifting political landscapes.