US and China Reach Framework Deal on TikTok Ownership Transfer

In a significant development, US and China have reached a framework agreement to transfer the ownership of TikTok to a US-controlled entity, potentially averting a nationwide ban of the popular social media app. The deal, announced after high-level trade talks in Madrid, is expected to be finalized during a call between US President Donald Trump and Chinese President Xi Jinping on Friday, September 19, 2025.

US Treasury Secretary Scott Bessent confirmed that the commercial terms of the agreement have been settled, although specific details remain confidential. The move comes in response to the Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACA), passed in April 2024, which requires the divestiture of TikTok’s US operations from its Chinese parent company ByteDance to address national security concerns.

While the agreement marks a major step forward, several key issues remain unresolved. One of the most significant points of contention is the fate of TikTok’s recommendation algorithm, which was developed by ByteDance in China. Beijing has reportedly agreed to license the algorithm to the new US-based entity, allowing TikTok to continue operating with features aligned with cultural preferences and user experience. However, critics are concerned that ByteDance’s influence may continue in subtle ways, especially in areas related to data security and content moderation.

The upcoming call between President Trump and President Xi is expected to resolve these outstanding issues and set the stage for finalizing the transfer. Observers believe this framework deal could not only preserve TikTok’s operations in US markets but also serve as a test case for managing future disputes involving technology platforms and geopolitical tensions.

Both US and China have expressed a commitment to working together to ensure the deal’s successful implementation. Stakeholders in the tech industry, lawmakers, and international analysts are closely watching the process, as it will have far-reaching implications for global technology regulation, data privacy, and economic cooperation between the two superpowers.

With the final approval expected soon, the TikTok ownership transfer could reshape the landscape of digital platforms, ensuring a delicate balance between innovation, security, and international cooperation.