The fate of TikTok in the U.S. hangs in the balance once again, as Beijing signals it will not approve a spin-off of the app’s American operations following President Trump’s sweeping tariff hikes this week. The deal—meant to avoid a nationwide ban—was nearly finalized, but sources close to both governments now say the process has frozen in the wake of rising U.S.-China trade tensions.
TikTok’s Deal Blocked After Tariffs
After months of negotiation, the plan was to spin off TikTok’s U.S. business into a majority-American-owned company, cutting ByteDance’s stake to below 20%. The structure had won approvals from ByteDance, U.S. regulators, and key investors—but China’s silence has become a hard “no.”
A 54% U.S. tariff on Chinese goods, announced Wednesday by Trump, appears to have directly triggered Beijing’s opposition. In response, China imposed its own 34% retaliatory tariff Friday.
“We hope to continue working in good faith with China, who I understand is not very happy about our reciprocal tariffs,” Trump said on Truth Social.
What’s Next?
Trump has now extended the deal deadline by 75 days, setting mid-June as the new cutoff. Without a sale, the app—used by 170 million Americans—faces a potential ban starting April 5, though enforcement has been delayed.
While Trump insists he doesn’t want TikTok to ‘go dark’, he’s also using tariff leverage to pressure Beijing into greenlighting the deal.
“We look forward to working with TikTok and China to close the deal,” Trump added. “We do not want TikTok to ‘go dark’.”
White House-Backed Buyout In Limbo
The Biden-era law—passed with broad bipartisan support—requires TikTok to divest from ByteDance to operate legally in the U.S. Despite enforcement being postponed under Trump’s second term, the Justice Department signaled no action in January, leading Apple and Google to restore TikTok for downloads.
Now, a new plan backed by major investors like Susquehanna International Group and General Atlantic seeks to buy the U.S. business. But any buyout still needs China’s blessing—which appears increasingly unlikely.
Amazon, meanwhile, has reportedly submitted a last-minute bid for TikTok’s U.S. operations, but insiders say the offer is not being seriously considered by regulators or ByteDance.
Bigger Picture: Trade War Bleeds Into Tech War
TikTok’s stalemate is emblematic of the broader collapse in U.S.-China relations, with tech companies now caught in the tariff crossfire. Trump’s reciprocal tariff push—meant to pressure foreign trade partners—has sparked rapid retaliation, and could jeopardize foreign tech deals for the foreseeable future.
China’s Commerce Ministry said it would not accept “unilateral bullying,” adding that Beijing would “safeguard its rights and interests.”
As the clock ticks down to mid-June, the question isn’t just who will buy TikTok—it’s whether the deal can survive at all.
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