Delay in TikTok’s U.S. Spin-Off Following China Tariff Retaliation
TikTok’s spin-off plan for its U.S. operations is delayed due to Chinese objections related to new tariffs. The deal was nearly finalized but requires further approvals from various stakeholders. President Trump has extended the deadline for the divestment amid rising trade tensions with China.
TikTok’s plan to spin off its U.S. assets has been postponed following pushback from China regarding newly imposed tariffs. The agreement, which was nearly finalized by Wednesday, involved creating a new American-based company to manage TikTok’s U.S. operations with a majority stake held by American investors, while ByteDance would retain a minority position of less than 20%. Reports indicate that this plan garnered approval from existing and new investors, ByteDance, as well as the U.S. government.
President Donald Trump has granted an additional 75 days for ByteDance to divest TikTok’s U.S. assets due to the necessity of ensuring all relevant approvals are obtained. In a social media statement, Trump acknowledged that China is displeased with the reciprocal tariffs and emphasized the intention to negotiate in good faith. The original deadline for the sale was set to expire shortly, under a law enacted for 2024.
The recent geopolitical tensions have resulted in a 54% tariff on goods imported from China, following Trump’s announcement of significant tariffs earlier in the week. In light of these developments, Trump has shown willingness to negotiate a reduction of tariffs in order to facilitate the acquisition of TikTok by a non-Chinese entity, which currently has a user base of approximately 170 million Americans.
In summary, TikTok’s U.S. asset spin-off is currently stalled due to China’s pushback against new tariffs imposed by the United States. While efforts are ongoing to secure the necessary approvals, geopolitical factors such as tariffs have complicated negotiations. The outcome remains uncertain as discussions continue between the U.S. government and ByteDance.
Original Source: news.az
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