China has halted the sale of TikTok to American companies amid the ongoing trade tensions with the United States, a move influenced by the trade war initiated by Donald Trump.
United States President, Donald Trump, on Wednesday reportedly had an agreement in place to spin off ByteDance’s TikTok and its U.S. operations into a new American-based company.
This deal would make U.S. investors the majority owners and managers, with ByteDance, the Chinese parent company, retaining a minority stake, according to a source familiar with the discussions who spoke to the Associated Press.
Newsweek reached out to both the White House and ByteDance’s press team for confirmation, but did not receive a response by Friday.
TikTok, a widely popular video-sharing app owned by China-based ByteDance, has been under intense scrutiny in the United States due to national security concerns.
In January, the Supreme Court upheld Congress’s right to compel TikTok’s sale.
Shortly after taking office, Trump issued an executive order that delayed the ban on the app for 75 days, allowing TikTok to continue operating in the U.S. During this period, TikTok was required to finalize a U.S. sale by April 5 or face a potential ban.
However, on Friday, Trump announced he would sign an executive order to extend TikTok’s operations in the U.S. for another 75 days.
The deal to spin off TikTok fell apart just one day after Trump unveiled a sweeping global tariff package, which had caused instability in both domestic and international markets, prompting retaliatory actions. On Friday, China responded with its own tariffs.
The source, who spoke to AP under the condition of anonymity due to the sensitive nature of the negotiations, stated that following Trump’s tariff announcement, ByteDance officials reached out to the White House to inform them that the Chinese government would no longer approve the deal unless broader talks around trade and tariffs were initiated.
The arrangement had been under negotiation for months, with Vice President JD Vance’s team directly engaged with ByteDance and several potential U.S. investors.
According to the source, the Trump administration had been confident that China would approve the deal, but the imposition of the tariffs changed that.
A ByteDance spokesperson confirmed to AP that the company had been discussing a “potential solution” with the U.S. government but clarified that no agreement had been reached. “There are key matters to be resolved,” the spokesperson added, noting that any deal would be subject to Chinese law.
In a Friday post on Truth Social, Trump announced that he would extend the deadline for TikTok’s sale by signing an executive order.
“My Administration has been working very hard on a Deal to SAVE TIKTOK, and we have made tremendous progress,” he wrote. He explained that more work was required to secure all necessary approvals, which is why the extension was needed. Trump emphasized, “We do not want TikTok to ‘go dark,'” and expressed hopes for continued cooperation with both TikTok and China to finalize the deal.
Trump, who often highlights his business acumen, has touted tariffs as a way to address trade imbalances and boost American manufacturing.
He referred to the tariffs as America’s “declaration of economic independence.” However, many, including some Republicans, have voiced concerns over the economic impact, with Wall Street facing its worst week in five years.
By Friday’s close, the S&P 500 dropped nearly 6 percent, and the Dow Jones Industrial Average fell 5.5 percent. The Nasdaq composite index was down 5.82 percent, though Trump maintained that the tariffs would eventually lead to a market “boom.”
In early March, Vance expressed optimism about the TikTok deal, suggesting, “There will almost certainly be a high-level agreement that I think satisfies our national security concerns, allowing for a distinct American TikTok enterprise.”
In response to the first extension in January, TikTok CEO Shou Chew thanked President Trump for his commitment to working with the company to find a solution that would keep TikTok operational in the U.S.
“On behalf of everyone at TikTok and all our users across the country, I want to thank President Trump for his commitment to work with us to find a solution that keeps TikTok available in the United States,” Chew said in a video posted on the platform.
Looking ahead, Trump will sign an executive order to delay TikTok’s U.S. operations for another 75 days, pushing the deadline to June 19.
Meanwhile, the 10 percent baseline tariff on all imports will take effect on Saturday, followed by the “discounted reciprocal” tariffs aimed at key U.S. trading partners on April 9. On Friday, China announced a 34 percent tariff on all U.S. imports.
