TikTok Deal Delayed: China Balks After Tariff Hike

A proposed spinoff of TikTok's US operations is on hold after China indicated it would not grant approval for the deal—only days after President Donald Trump increased tariffs on Chinese imports.
On Friday, Trump delayed the deadline for ByteDance—the Chinese owner of TikTok—to sell the app's U.S. assets by 75 days. The earlier deadline, imposed under a 2024 law, mandated a sale by January or TikTok would be banned in the U.S.

"We hope to continue working in good faith with China, who I understand is not very happy about our reciprocal tariffs," Trump tweeted.

The Deal Structure: A U.S.-Based TikTok Firm

Prior to the hiatus, a virtually finalized deal would have:
Formed a new company based in the U.S. to accommodate TikTok's operations in the United States. Truncated ByteDance's interest to less than 20%, satisfying U.S. legal specifications.

The arrangement had apparently gathered approval from existing investors, potential investors, ByteDance, and the government of the U.S.

China Pushes Back Against the Move

The Washington-based Chinese Embassy reacted strongly. China has respected and protected enterprises' legitimate rights and interests at all times, as well as opposed the infringement upon the market economy's fundamental principles." This is in line with China's countermove after Trump's severe new tariffs—imposing additional U.S. duties on imports of Chinese products to 54%.

TikTok's Fate Remains Unclear

Trump affirmed he is still willing to engage in negotiations
"We look forward to closing the deal with TikTok and China. We don't want TikTok to 'go dark'," he said.

But one big hurdle still stands in the way—China has not made any public commitment to selling TikTok's American business.

A New Mid-June Deadline Set

The new Trump order provides all sides with until mid-June to come up with a final deal. Negotiations are said to center on permitting U.S. investors—such as Susquehanna International Group and General Atlantic—to own a larger share of ByteDance and control the U.S. entity.

Background: Why the Deal Matters

The Congress passed the law in 2024, citing national security concerns over TikTok’s Chinese ownership. Lawmakers warned the app could be used for surveillance or covert influence. Though the law was set to ban TikTok by January 19, Trump chose not to enforce it after beginning his second term.