Executive Summary
On December 18, 2025, TikTok CEO Shou Zi Chew confirmed that ByteDance signed binding agreements to create a new US joint venture called "TikTok USDS Joint Venture LLC". The deal, expected to close on January 22, 2026, values TikTok US at approximately $14 billion and creates a majority American-controlled entity—though critics argue ByteDance retains too much influence.
Ownership Structure
The new entity will be called TikTok USDS Joint Venture LLC. American and global investors will hold an 80.1% stake, while ByteDance retains 19.9%.
| Investor | Country | Stake |
|---|---|---|
| Oracle | USA | 15% |
| Silver Lake | USA | 15% |
| MGX | UAE | 15% |
| ByteDance Investor Affiliates | Various | ~35% |
| ByteDance (Direct) | China | 19.9% |
Governance Structure
The new entity will have a seven-member board of directors with a majority of American members. ByteDance will appoint one board member. The US joint venture will control data protection, content moderation, and algorithm security for American users.
Timeline: Five Years in the Making
Security Measures
What the Deal Promises
- Oracle as "Trusted Security Partner" — responsible for auditing and validating compliance
- US data stored locally in Oracle's secure cloud environment
- American team retrains algorithm using only US user data
- Content moderation controlled by new US entity
What Critics Are Concerned About
While the deal creates a US-controlled entity, ByteDance retains ownership of the underlying algorithm technology. The algorithm will be licensed to the US entity, raising questions about whether true separation has been achieved.
"The law requires a clean break from ByteDance. This structure doesn't meet that standard. It looks more like a franchise deal that leaves TikTok's core technology in China than a true divestment."
— Jim Secreto, Former Treasury Official
"The American TikTok might end up censoring or hiding speech permissible on global TikTok."
— Anupam Chander, Georgetown Law Professor
What Happens Next
Chinese Government Approval Required
The deal requires approval from the Chinese government before closing. While Trump has said Chinese President Xi Jinping is "on board," Beijing has not officially confirmed approval. China's export control laws could still block the transfer of algorithm technology.
Expected closing date: January 22, 2026. If the deal closes as planned, TikTok USDS Joint Venture LLC will begin operating as an independent entity with:
- Majority American board oversight
- Oracle managing data infrastructure
- New algorithm trained exclusively on US data
- Independent content moderation for US users
Bottom Line
TikTok has signed a binding agreement to create a new US joint venture valued at ~$14 billion. American investors will control 80.1% of the new entity, with Oracle serving as the security partner responsible for US user data. However, ByteDance retains the underlying algorithm technology and a 19.9% stake, leading some experts to question whether this constitutes the "clean break" Congress intended.
For TikTok's 170 million American users, the deal means the app should continue operating without interruption—assuming China approves the technology transfer and the deal closes by January 22, 2026.