TikTok Establishes U.S. Joint Venture to Address National Security Concerns
In a significant move to address national security concerns and ensure its continued operation in the United States, TikTok has announced the formation of a new joint venture named TikTok USDS Joint Venture LLC. This development comes in response to an Executive Order signed by U.S. President Donald Trump in September 2025, which mandated structural changes to the company’s ownership and data management practices.
Ownership Restructuring
Under the terms of the new agreement, ByteDance, TikTok’s Chinese parent company, will divest the majority of its stake in the U.S. operations. A consortium of American investors, including tech giants and prominent financial institutions, will acquire these shares, resulting in ByteDance retaining a 19.9% minority stake. This restructuring aims to alleviate concerns about foreign influence and data security, ensuring that the majority ownership and control of TikTok’s U.S. operations reside with American entities.
Data Security Measures
To further address national security concerns, the joint venture has implemented comprehensive safeguards:
– Data Protection: U.S. user data will be stored exclusively within Oracle’s secure cloud infrastructure located in the United States. This measure ensures that sensitive information remains within U.S. jurisdiction, mitigating risks associated with foreign data access.
– Algorithm Security: TikTok’s content recommendation algorithm will undergo retraining and continuous updates based on data from U.S. users. This process will be conducted within Oracle’s cloud environment, ensuring that the algorithm operates independently of foreign influence.
– Content Moderation: The joint venture will implement robust trust and safety policies, including stringent content moderation practices. These measures aim to maintain a safe and compliant content ecosystem for U.S. users.
– Transparency and Accountability: To ensure ongoing compliance and build public trust, the joint venture will engage in regular transparency reporting and obtain third-party certifications. These steps will provide external validation of the company’s adherence to established security and privacy standards.
Compliance with Industry Standards
The joint venture’s data privacy and cybersecurity program will align with major industry standards, including:
– National Institute of Standards and Technology (NIST) Cybersecurity Framework (CSF) and Special Publication 800-53: These frameworks provide guidelines for managing and reducing cybersecurity risks.
– ISO/IEC 27001: An international standard for information security management systems, ensuring that organizations implement and maintain effective security controls.
– Cybersecurity and Infrastructure Security Agency (CISA) Security Requirements for Restricted Transactions: Guidelines that outline security measures for transactions involving sensitive information.
By adhering to these standards, the joint venture aims to establish a robust security posture that protects user data and maintains compliance with regulatory requirements.
Extension to Other ByteDance Applications
The security measures and operational changes implemented by the joint venture will also extend to other ByteDance-owned applications and websites operating in the U.S., including CapCut and Lemon8. This comprehensive approach ensures that all platforms under the ByteDance umbrella adhere to the same stringent security and privacy standards.
Presidential Endorsement
President Donald Trump has publicly endorsed the new arrangement, stating that the company will now be owned by a group of Great American Patriots and Investors, the Biggest in the World. He also expressed gratitude to Chinese President Xi Jinping for his cooperation in facilitating the deal.
Background and Context
The formation of the joint venture follows a series of regulatory challenges and actions taken against TikTok:
– April 2024: A federal law signed by former President Joe Biden mandated that TikTok’s U.S. operations be transferred to American ownership or another approved entity, citing national security concerns over ByteDance’s Chinese ownership.
– June 2020: India imposed an outright ban on TikTok, citing similar security concerns.
– November 2024: The Canadian government ordered TikTok to cease its operations within the country, further highlighting the global apprehension regarding the platform’s data practices.
These actions underscore the widespread concerns about the potential for foreign governments to access user data through platforms like TikTok.
Implications for Users and Businesses
With over 200 million American users and 7.5 million businesses utilizing the platform, TikTok’s continued operation in the U.S. is significant. The establishment of the joint venture and the implementation of enhanced security measures aim to provide reassurance to users and stakeholders about the platform’s commitment to data privacy and national security.
Looking Ahead
The successful formation of TikTok USDS Joint Venture LLC marks a pivotal moment in the platform’s history, reflecting a concerted effort to balance user engagement with national security imperatives. As the joint venture begins its operations, ongoing transparency, adherence to industry standards, and collaboration with regulatory bodies will be crucial in maintaining trust and compliance.
This development also sets a precedent for other foreign-owned technology companies operating in the U.S., highlighting the importance of aligning business operations with national security requirements and regulatory expectations.
