The TikTok platform decided to take a key step to ensure its continued presence in the United States by accepting an agreement that transfers control of its local operations to a group of American investors. The move seeks to end a political and legal dispute that has dragged on for years and threatened to force the popular app out of the US market. The announcement was communicated internally by TikTok CEO Shou Chew. In a memo to employees, he explained that the company signed agreements to create a new US-based joint venture led by US capital. The transaction is expected to close on January 22, 2026. Chew emphasized that this step will allow TikTok to continue operating for its more than 170 million users in the country. He also stressed that the platform will remain part of a global community. In the message, he thanked the staff for their work and assured them that the priority will remain supporting users, content creators, and businesses as the process moves forward. Chew also said they will continue to share further updates as they work toward closing the deal. This agreement didn't come out of nowhere. In September, President Donald Trump signed an executive order that paved the way for separating TikTok's US operations from its parent company, ByteDance, which is based in China. The decision was in response to the Protecting Americans from Foreign Adversaries Controlled Applications Act, which prohibits apps controlled by governments considered adversaries, including China, for national security reasons. In that context, Trump stated at the time that he had “great respect for President Xi” and that he “really appreciated him approving the deal, because to do it properly we really needed China’s support, China’s approval.”The president also stated that the outcome would be positive for both nations and that China seeks fair treatment in its trade relations with the United States. Axios was the first media outlet to report the closing of the deal. This transaction is in response to a law passed last year that requires ByteDance to divest itself of TikTok in the United States or face its removal from app stores and web hosting services. One of the most sensitive points of the agreement is the handling of the recommendation algorithm. A senior White House official explained in September that ByteDance's algorithm will be copied and retrained to operate solely with data from American users. Oracle, for its part, will offer "top-to-bottom security" by hosting the data and reviewing the application's code to ensure that "the algorithm behaves appropriately and is secure." Axios reported that Oracle, Silver Lake, and the Abu Dhabi-based firm MGX will collectively own 45% of the new entity. Almost a third (35%) will remain in the hands of current ByteDance investors.

Despite the progress, the agreement is not without its critics. Lawmakers like Republican Representative John Moolenaar expressed concern about possible residual ties with ByteDance.

“The transition to a majority US-owned entity would be an important step, but the law also prohibits cooperation on the recommendation algorithm and operational ties with ByteDance,” he noted in a quoted statement.

With this agreement between TikTok and US investors, the beginning of the end of this controversy begins, although other uncertainties remain, such as data protection, technological independence, and strict compliance with the law.

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